Adani Group Cancels $600 Million Bond Offering
Adani Group has withdrawn a $600 million bond offering after bribery charges were filed against its chairman, Gautam Adani, by prosecutors in the United States. The charges, which were unveiled yesterday by the US Department of Justice and the Securities and Exchange Commission, accuse Adani and executives of orchestrating $250 million in bribes to Indian officials for solar energy contracts.
The charges sent Adani’s U.S. dollar bonds tumbling in Asian trading. Adani Green Energy bonds, issued in March, dropped 15 cents to 80 cents on the dollar, while other securities plunged sharply. The losses mirror the fallout from the 2023 Hindenburg Research report, which accused the conglomerate of stock manipulation and accounting fraud, erasing $150 billion in market value.
The indictment, filed in Brooklyn, claims that executives of Adani, including Sagar Adani and Vneet Jaain, violated federal laws of the United States and misled investors when raising capitals. The group's governance and regulatory risks are now under renewed scrutiny. "These charges have shed light on persistent challenges for Adani despite surviving Hindenburg's allegations", said Mohit Mirpuri, a fund manager at SGMC Capital.
It was a bit of a setback for Adani as he tries to revive investor confidence; however, the conglomerate recently announced a $10 billion investment plan in U.S. energy and infrastructure, signifying its global ambitions amidst increasing legal and financial challenges.
As pressure mounts for Adani, analysts warn that the bribery case may strain the group's financial standing and credibility further, complicating its strategy in international expansion.
