‘Kid wants mamma…’: Adani Group CFO takes a jibe at Bill Ackman for suggesting bailout for Silicon Valley Bank

Adani Group Chief Financial Officer (CFO) Jugeshinder Singh on Saturday took a jibe at billionaire investor Bill Ackman for suggesting that the US government should consider a "highly dilutive" bailout for startup-focused lender SVB Financial Group.

"Kid wants "mamma" to come help," Singh tweeted replying to Ackman's post.

“The failure of SVB Financial could destroy an important long-term driver of the economy as VC-backed companies rely on Silicon Valley Bank (SVB) for loans and holding their operating cash. If private capital can’t provide a solution, a highly dilutive gov’t preferred bailout should be considered," Ackman, founder and CEO of Pershing Square Capital Management, said in a series of tweets.

"The gov’t could also guarantee deposits in exchange for a dilutive warrant issuance and other covenants and protections. If @SVB_Financial is indeed solvent, this would buy time to enable SVB to restore the franchise and raise new private capital," the tweet read.

To be clear, a bailout should be designed to protect SVB Financial depositors, not equity holders or management, Ackman stated. "We should not reward poor risk management or protect shareholders from risks they knowingly assumed."

"The risk of failure and deposit losses here is that the next, least well-capitalized bank faces a run and fails and the dominoes continue to fall. That is why gov’t intervention should be considered," he added.

The startup-focused lender SVB Financial Group became the largest bank to fail since the 2008 financial crisis on Friday, in a sudden collapse that roiled global markets.

California banking regulators closed the bank, which did business as Silicon Valley Bank, on Friday and appointed the Federal Deposit Insurance Corporation (FDIC) as receiver for later disposition of its assets.

The lender, based in Santa Clara, was ranked as the 16th biggest in the US at the end of last year, with about $209 billion in assets and about $175 billion in deposits at the end of 2022, reported Reuters.

The billionaire's reaction to the downfall of SVB Financial was starkly different when compared to the recent report on the Adani Group by investment research firm Hindenburg Research. The report had claimed that the conglomerate “engaged in brazen stock manipulation and accounting fraud schemes over the course of decades".

Ackman said that he found short-seller Hindenburg Research's report on Adani Group "highly credible and extremely well researched."

"Adani’s response to @HindenburgRes is the same as @Herbalife’s response to our original 350-page presentation. Herbalife remains a pyramid scheme. I found the Hindenburg report highly credible and extremely well researched. @AdaniOnline response speaks volumes. Caveat emptor," he tweeted.

Meanwhile, UK’s Financial Times reported on Friday that Adani family is looking to sell up to 5% stake in Ambuja Cements for $450 million to reduce debt.

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