New Delhi (TIP)- The Adani Group plans to prepay a $500 million bridge loan due next month after some banks balked at refinancing the debt following a short seller attack that sent the group’s assets tumbling.

Barclays Plc, Standard Chartered Plc and Deutsche Bank AG are among banks that lent Adani $4.5 billion to finance the purchase of Holcim Ltd. cement assets last year. A portion of that loan is due March 9.

The lenders were in talks to refinance the loan up to a week before the critical report from Hindenburg Research was published, according to people familiar with the matter. Those talks stalled after the report alleging fraud led to a massive selloff, the people said, asking not to be identified discussing a private matter.

An Adani spokesperson said the conglomerate had been in talks with the banks to refinance part of the loan but the group plans to prepay it. The spokesperson said discussions with the banks have not stalled. Representatives for Barclays and Deutsche Bank declined to comment. A representative for Standard Chartered wasn’t immediately available. This marks the second time in a week that the group has taken steps to prepay debt as it fights to regain investor confidence and stem the stock rout. Billionaire Gautam Adani and his family have prepaid $1.11 billion worth of borrowings backed by shares, the group said.

Adani faced a margin call of more than $500 million on that loan, prompting the Indian tycoon to repay the whole debt, Financial Times reported Wednesday. The Adani Group said it didn’t receive a formal request for a margin call and that the loan was repaid early “per our prepayment planning,” the paper reported.

Global banks are ramping up their scrutiny of the group following the Hindenburg report. Citigroup Inc.’s wealth arm has stopped accepting Adani securities as collateral for margin loans, following a similar move by Credit Suisse Group AG. The corporate empire of Adani, once the world’s second-richest person, has been thrown into a tailspin after the Hindenburg report on alleged malpractices. Ten Adani group companies including Adani Total Gas Ltd., Adani Enterprises Ltd. and Adani Transmission Ltd. at one point erased $117 billion from their combined market value in the selloff.

MFs had doubts over Adani debt: Report

Shares of the Adani Group have been on a rebound for the past two days but the voting pattern of mutual funds in resolution of its listed companies shows their unease over at least three issues that were red-flagged in the Hindenburg Research report.

Mutual funds are large block investors and recent SEBI directions have made them more active participants in governance. One of these directions in 2021 made it compulsory for the MFs to vote on all corporate resolutions. No longer can MF representatives, especially from state-owned companies, afford to not turn up for Board meetings. The disclosures by the MFs about their voting patterns have shown that many of them had reservations on three issues: related party transactions among Adani companies (there were over 6,000 in 21-22 alone), taking on substantial debt and appointment of Adani family members in key positions. Disclosures by mutual funds show many of them had reservations on related party transactions among Adani firms, taking on substantial debt and appointment of Adani family members in key positions.