The Adani Group headquarters in Ahmedabad, India.
Shares of Indian billionaire Gautam Adani’s conglomerate continued to drop on Tuesday amid the fallout from its bribery indictment in the U.S., shrinking the tycoon’s net worth by almost $16 billion since the allegations surfaced last week.
Adani Green Energy led the declines, with the shares of the renewable energy company slumping more than 7% in Mumbai trading. Shares of the group’s flagship Adani Enterprises fell almost 5%, while Adani Ports slipped 3%.
Last week, U.S. prosecutors accused Gautam Adani and other executives of orchestrating a $250 million bribery scheme to secure lucrative energy contracts from the Indian government. The Securities and Exchange Commission also filed a complaint against Adani, alleging he violated the antifraud provisions of U.S. securities laws when his companies raised funds from American investors through false and misleading statements. Adani has denied the allegations and vowed to seek legal recourse.
Since then, the tycoon’s net worth has tumbled from almost $70 billion before the U.S. indicted him and his executives to about $54 billion today, according to Forbes real-time data. The group is also facing a backlash from investors and business partners.
“The proceedings and the outcome could reflect significantly weaker corporate governance practices of the group and lead to negative rating actions.”
Credit rating agency Fitch Ratings yesterday 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.
“While the US indictment mainly involves Adani Green Energy’s key leadership, the proceedings and the outcome could reflect significantly weaker corporate governance practices of the group and lead to negative rating actions,” Fitch said in a statement.
On Monday, French oil giant TotalEnergies announced it will halt further investments in Adani Green Energy amid the bribery allegations. TotalEnergies holds an almost 20% stake in Adani Green and is a joint venture partner in several project companies.
“Until such time when the accusations against the Adani group individuals and their consequences have been clarified, TotalEnergies will not make any new financial contribution as part of its investments in the Adani group of companies,” the company said in a statement.
Kenya canceled two major deals with the Adani Group on Thursday, including a $1.85 billion airport management contract and a $736 million deal to build power lines.
In Sri Lanka, experts called for a review of Adani’s $442 million wind power deal over the weekend. Additionally, Bangladesh’s High Court initiated an investigation into Adani’s power supply deal as the conglomerate threatened to cut off electricity over $850 million in unpaid dues.
