Adani shares plummet on US bribery charges

21st Nov 2024 12:38

(Sharecast News) - Shares in Adani companies plunged on Thursday, after US prosecutors indicted billionaire founder Gautam Adani, one of the world's richest men.

The US authorities have accused Adani, his nephew Sagar and several others of being involved in a $265m scheme to bribe Indian officials.

Sagar is an executive director at Adani Green Energy, the company at the centre of the allegations

A spokesperson for India's Adani Group denied all the allegations, calling them "baseless" and adding: "All possible legal recourse will be sought."

Breon Peace, US Attorney for the Eastern District of New York, said: "As alleged, the defendants orchestrated an elaborate scheme to bribe Indian government officials to secure contracts worth billions of dollars.

"Gautam Adani, Sagar Adani and Vneet Jaain lied about the bribery scheme as they sought to raise capital from US and international investors." Jaain is chief executive of Adani Green Energy.

The Securities and Exchange Commission issued its own charges in parallel, accusing Adani and Sagar of violating the antifraud provisions of federal securities laws.

It is seeking permanent injunctions, civil penalties and officer and directors bars against them and Cyril Cabanes, a former board member of Azure Power Global.

As at 1445 GMT, Adani's flagship Adani Enterprises had slumped 23% while Adani Green Energy had lost 19%.

The Adani spokesperson said the organisation was "law abiding and fully compliant" with all laws.

"As stated by the US Department of Justice itself, the charges in the indictment are allegations and the defendants are presumed innocent unless and until proven guilty.

"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."

Azure Power said in a statement that the former officers referenced in the indictment were no longer associated with the company, and that it continued to cooperate with the US authorities.

This is the second scandal to hit Adani in just under two years. Shares plunged in 2023 after short seller Hindenburg Research accused the conglomerate of using offshore tax havens improperly. The company has strongly denied the allegations.

Adani founded the Adani Group in 1988 as a commodity trading business, but has since expanded it to include energy, infrastructure and airports.