Gautam Adani, chairman of Adani Group, speaks during the Forbes CEO Summit in Singapore, on Tuesday, Sept. 27, 2022. India needs fossil fuels to serve large populations and getting rid of all fossil fuels instantly would not work for the nation, Adani said. Photographer: Edwin Koo/Bloomberg via Getty Images
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India’s Adani Group on Thursday denied allegations of bribery and fraud made by U.S. authorities in relation to the group’s chair Gautam Adani, saying all such claims were “baseless.”
Shares of companies in India’s Adani Group plunged after Gautam Adani, one of the world’s richest people, was indicted in a New York federal court on charges regarding an alleged bribery and fraud scheme. Shares in Adani Green Energy, the firm at the center of the allegations, slumped 17.9%.
Adani and several other defendants are accused of paying Indian government officials more than $250 million in bribes to obtain solar energy supply contracts worth more than $2 billion in profits.
The company’s 62-year-old chair, his nephew Sagar Adani and fellow company executive Vneet Jaain are charged with misleading U.S. and international investors about their company’s compliance with antibribery and anticorruption practices, as they raised more than $3 billion in capital to fund energy contracts.
An Adani Group spokesperson said the allegations made by the U.S. Department of Justice and the U.S. Securities and Exchange Commission against directors of Adani Green Energy are “baseless and denied.”
“The Adani Group has always upheld and is steadfastly committed to maintaining the highest standards of governance, transparency and regulatory compliance across all jurisdictions of its operations. We assure our stakeholders, partners and employees that we are a law-abiding organisation, fully compliant with all laws,” the spokesperson said in an emailed statement.
They added that “all possible legal recourse will be sought,” following the allegations.
Shares of Adani investor GQG Partners also cratered around 20% on Thursday.
A common question from investors following the charges is how exposed Indian lenders are to Adani Green Energy, Citi analysts said in a Thursday note.
The energy company has borrowings of 630 billion Indian rupees and cumulative charges on assets are equivalent to 650 billion Indian rupees, Citi said, noting that lender-specific data may not be very accurate when it comes to fund-based exposure.
Following the indictment charges, Adani Green Energy cancelled plans to raise around $600 million through U.S. dollar-denominated bonds.
– CNBC’s Boon Ping and Dan Mangan contributed to this story.
