Gautam Adani, chairman of Adani Group, speaks during a Bloomberg Television interview at the … [+]
In a stock exchange filing Wednesday morning, Adani Green Energy said that contrary to media reports, its chairman Gautam Adani and his aides have not been charged for violating the U.S. Foreign Corrupt Practices Act (FCPA).
The U.S. Department of Justice’s indictment does not mention Gautam Adani, his nephew Sagar Adani or Vneet Jaain, managing director of Adani Green, in any count related to conspiracy to violate the FCPA, Adani Green said in a regulatory filing. A media statement from the group said the three have “only” been charged with an alleged securities fraud conspiracy in a complaint filed by the Securities and Exchange Commission.
“The DOJ indictment offers no evidence that bribes were paid by Adani executives to Indian government officials, the indictment and the complaint solely rest on claims that bribes were promised or discussed,” the company filing said.
The company issued the clarification as shares of the group’s companies continued to drop this week amid the fallout from the charges announced by the Justice Department last week in connection with an alleged $250 million bribery scheme to secure energy deals from the Indian government. The SEC also filed a complaint against the group for allegedly violating the antifraud provisions of U.S. securities laws when Adani companies raised funds from American investors through false and misleading statements.
“Gautam S. Adani and seven other business executives allegedly bribed the Indian government to finance lucrative contracts designed to benefit their businesses. Adani and other defendants also defrauded investors by raising capital on the basis of false statements about bribery and corruption, while still other defendants allegedly attempted to conceal the bribery conspiracy by obstructing the government’s investigation,” James Dennehy, FBI assistant director in charge, said in a statement issued by the Eastern District of New York last week.
The slump in Adani group shares has wiped out almost $15 billion of billionaire Adani’s net worth, which stands at about $55 billion today, according to Forbes’ real-time data. The group is also facing a backlash from investors and business partners.
“The ill-founded U.S. action and reckless false reporting have led to significant repercussions for the Indian conglomerate, such as international project cancellations, financial market impact and sudden examination from strategic partners, investors and the public,” Adani Green said.
On Thursday, Kenya canceled an airport and power lines contracts valued at over $2.5 billion with the Adani Group, while France’s TotalEnergies announced on Monday it will halt further investments in Adani Green Energy amid the bribery allegations.
Credit rating agency Fitch Ratings this week placed bonds of Adani companies under a negative watch list for a possible downgrade, citing increased corporate governance risks and potential contagion effects that could impact the group’s access to funding and liquidity.
