Lagatar24 Desk
NEW DELHI: The Adani Group has called off its $600 million bond offering after being hit with bribery allegations by US prosecutors. The charges, brought by the Department of Justice (DOJ) and the Securities and Exchange Commission (SEC), accuse Gautam Adani and senior executives of orchestrating a $250 million bribery scheme to secure solar energy contracts in India.
The legal developments have shaken investor confidence, with Adani’s dollar bonds suffering sharp declines in Asian markets. Some securities plummeted by as much as 15 cents, signaling heightened concerns over the group’s governance and regulatory compliance.
Adani Green Energy Reacts
In a formal statement, Adani Green Energy acknowledged the indictment, which named key figures including Sagar Adani and Vneet Jaain. The company announced the withdrawal of its proposed USD bond offering in light of the ongoing legal proceedings.
“The United States Department of Justice and the United States Securities and Exchange Commission have issued a criminal indictment and a civil complaint, respectively, against Gautam Adani, Sagar Adani, and Vneet Jaain,” the statement read. “As a result, our subsidiaries have decided not to proceed with the proposed bond offerings.”
Market Impact
The announcement led to a steep drop in Adani Group’s stocks, with Adani Green Energy shares plunging by 18% on the Bombay Stock Exchange (BSE) and other group securities mirroring similar losses. Existing Adani Green Energy bonds issued earlier this year sank to record lows of 80 cents on the dollar.
Historical Context and Future Concerns
This indictment marks another challenge for the Adani Group, following the fallout from the 2023 Hindenburg Research report that accused the conglomerate of stock manipulation and fraud, wiping $150 billion from its market value.
“While Adani managed to withstand the Hindenburg allegations, these bribery charges bring to light ongoing governance and regulatory risks,” said Mohit Mirpuri, a fund manager at SGMC Capital in Singapore.
