Hindenburg-hit Adani Group's proposed Air Works deal has long passed its stop date: Report

Adani Group's proposed acquisition of maintenance, repair and overhaul (MRO) company Air Works has passed its long stop date and there are no discussions between the two companies regarding extension of deal timelines, a media report said, citing ratings agency Crisil.

"Crisil Ratings is given to understand that there are no ongoing discussions between the concerned parties to extend the validity of the term sheet," the ratings agency said in a June 7 note, which was seen by Economic Times.

In October last year, Adani Defence Systems & Technologies Ltd (ADSTL) had signed definitive agreements to acquire Air Works, a highly diversified independent MRO with the largest pan-India network presence across 27 cities. The major shareholders of Air Works are the Menon families, Punj Lloyd Aviation, GTI Capital and a company employees' welfare trust.

The acquisition was aimed at bolstering Adani's airport business. The group manages seven airports across the country.

However, the Adani Group halted the Rs 400-crore acquisition owing to a major shareholder in the target entity being forced into liquidation.

Adani Group was unable to close the deal as the Punj Lloyd Group, which holds 23 per cent stake in the company, went under liquidation, causing inordinate legal delays in closing the deal, an ET report had said earlier. 

Air Works has developed extensive operational capabilities within the country for key defence and aerospace platforms. From the first P-8I aircraft Phase 32 checks to Phase 48 checks and MRO on the landing gear of the Indian Air Force’s 737 VVIP aircraft, Air Works undertakes base maintenance for ATR 42/72, A320 and B737 fleet of aircraft from its EASA and DGCA-certified facilities at Mumbai, Delhi, Hosur and Kochi.

The shares and bonds of Adani Group tumbled after Hindenburg Research released a critical report in January that accused it of fraud. The listed Adani firms lost over $100 billion in market value due to the scathing report. However, the ports-to-power conglomerate has vehemently denied the short seller’s allegations.

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