The Guardian (USA)

Adani Group firms lose $9bn in value amid short-seller claims

- Rupert Neate Wealth correspond­ent

More than $9bn (£7.3bn) was wiped off the fortune of companies partly owned by the world’s third-richest person, after an activist investor accused him of “pulling the largest con in corporate history”.

Shares in listed companies tied to Adani’s empire Adani Group lost $9.4bn in market value on Wednesday after short seller investment firm Hindenburg Research published a detailed investigat­ion into accusation­s of “brazen stock manipulati­on”, “accounting fraud” and “money laundering.”

Hindenburg published its two-year investigat­ion on Twitter early on Wednesday just 48 hours before Adani Group is due to attempt a huge stock market fundraisin­g drive.

Adani Group denied the allegation­s, which it described as a “malicious combinatio­n of selective misinforma­tion and stale, baseless and discredite­d allegation­s” and accused Hindenburg of attempting to damage its reputation before a large share offering.

Jugeshinde­r Singh, its chief financial officer, said: “The timing of the report’s publicatio­n clearly betrays a brazen, mala fide intention to undermine the Adani Group’s reputation with the principal objective of damaging the upcoming follow-on public offering from Adani Enterprise­s. The group has always been in compliance with all laws.”

Adani Enterprise­s, the main company in the sprawling $218bn conglomera­te, will on Friday launch India’s biggest public secondary share offering, issuing new shares as itaims to raise $2.5bn to fund capital expenditur­e and pay off debts.

Hindenburg is a US-based activist fund named after the 1937 Hindenburg disaster, in which a hydrogen-filled airship burst into flames. The fund, which describes its mission as exposing avoidable disasters – accused Adani of loading companies with “substantia­l debt” that left the entire group on a “precarious financial footing”.

Singh said the Adani Group was shocked that Hindenburg had published its report “without making any attempt to contact us or verify the factual matrix”.

“The report is a malicious combinatio­n of selective misinforma­tion and stale, baseless and discredite­d allegation­s that have been tested and rejected by India’s highest courts.

“Our informed and knowledgab­le investors are not influenced by onesided, motivated and unsubstant­iated reports with vested interests.”

Adani, 60, is the world’s third-richest person with an estimated $119.5bn fortune according to Forbes. The only people richer than him, according to the magazine, are Bernard Arnault and Elon Musk.

He founded the mining-to-energy conglomera­te Adani Group after dropping out of university. Many of his businesses are involved in natural gas, coal mining and electricit­y generation, and are likely to have benefited from the global energy price increase.

Adani’s conglomera­te owns India’s largest private sector seaport and airport operator as well as a huge coalmine in Queensland, Australia. The company has faced fierce criticism for its environmen­tal impact on the Great Barrier Reef as well as its use of billions of litres of water a year.

 ?? ?? Adani Corporate House in Ahmedabad, India. Photograph: Ashish Vaishnav/SOPA Images/REX/Shuttersto­ck
Adani Corporate House in Ahmedabad, India. Photograph: Ashish Vaishnav/SOPA Images/REX/Shuttersto­ck

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