Adani Faces $55 Billion Market Value Drop amid US Fraud Charges
The Indian conglomerate Adani Group has experienced a significant loss of nearly $55 billion in market value after US prosecutors filed charges against its top executives, including chairman Gautam Adani, who is considered one of the wealthiest individuals globally.
The charges, unveiled on November 20 in New York, allege that Adani and several high-ranking managers of group companies intentionally misled international investors regarding a $265 million bribery scheme. The indictment claims that they were involved in offering, authorizing, making, and promising to make bribe payments to Indian government officials. Adani Group has firmly denied these allegations, dismissing them as unfounded.
In response to the Department of Justice (DOJ) indictment, the company emphasized that there is no direct evidence proving that Adani executives paid bribes to Indian officials. They clarified that the allegations are based on discussions or promises of bribes without any concrete confirmation of actual payments.
The legal turmoil and alleged misinformation have had severe financial and reputational repercussions for the group. Several international projects have been halted, leading to a substantial loss of market capitalization totaling around $55 billion across its 11 listed companies, according to the company’s announcement.
Adani Green Energy Ltd, a key player in the controversy, stated in a stock exchange filing that Gautam Adani, his nephew Sagar Adani, and the company’s managing director Vneet Jaain have not been charged with violating the US Foreign Corrupt Practices Act. However, they are facing charges related to an alleged conspiracy to commit securities fraud, wire fraud, and securities fraud, all of which could result in financial penalties.
Prominent figures like former Indian Attorney General Mukul Rohatgi and Rajya Sabha MP Mahesh Jethmalani have publicly addressed the media, asserting that the allegations lack credible evidence and specificity. Rohatgi highlighted that the charges primarily target other individuals rather than Adani executives, making meaningful responses challenging.
The allegations have stirred a political storm in India, with opposition leaders demanding immediate legal action against Gautam Adani and criticizing the impact of the indictment on the country’s global reputation. Jethmalani has raised concerns about the timing and motives behind the DOJ’s actions, referencing former US President Donald Trump’s criticism of the agency.
Overall, the situation has cast a shadow over the Adani Group, prompting intense scrutiny and debate in both financial and political spheres. The company continues to stand by its denial of the allegations and is navigating a complex and challenging legal landscape.
