Adani Hindenburg Row: According to an article published on Thursday by the Organised Crime and Corruption Reporting Project (OCCRP), millions of dollars were invested in some publicly listed equities of India’s Adani Group using “opaque” Mauritius funds that “obscured” the involvement of accused Adani family business associates.
Unveiling Offshore Stock Transactions
Nonprofit media organisation OCCRP reported that its investigation discovered at least two incidents when the investors acquired and sold Adani stock using such offshore companies, citing study of information from numerous tax havens and official Adani Group correspondence. The OCCRP article came after U.S.-based short-seller Hindenburg Research accused Adani Group of unethical business practises in January. This included the use of offshore organisations in tax havens like Mauritius from which certain offshore funds “surreptitiously” acquired stock in Adani’s listed companies.
Adani Group Counters Hindenburg’s Claims
The Adani Group has dismissed Hindenburg’s assertions as false and unsupported and asserted that it has always complied with the law. However, after a comeback in recent months after it paid off some debt and restored some investor trust, the Adani group equities lost $150 billion in market value in the days following the January disclosure and continue to be down roughly $100 billion. The Mauritius funds under investigation by journalists were already mentioned in the Hindenburg report, according to a statement from Adani Group to OCCRP, and the “allegations are not only baseless and unsubstantiated but are rehashed from Hindenburg’s allegations.”
Denying Allegations and Emphasizing Legal Compliance
“It is categorically stated that all the Adani Group’s publicly listed entities are in compliance with all applicable laws including the regulation relating to public share holdings,” it told the OCCRP, according to the news article. Reuters has not independently confirmed the claims made by OCCRP. The devastating Hindenburg report Gautam Adani, a multibillionaire and the head of the ports-to-energy business, was the third richest person in the world as of January. He was obliged by the crisis to postpone a $2.5 billion share sale and persuade banks of his financial acumen. Later, a panel was constituted by the Indian Supreme Court to supervise an investigation into market regulators based on the Hindenburg report. The panel stated in May that the regulator’s inquiries into possible violations involving foreign investments in the Adani group had “drawn a blank” up to that point.
Regulatory Agency’s Ongoing Probe
The agency stated last week that its report was almost finished but that it was taking time to investigate some offshore dealings because some of the businesses involved were based in tax haven countries. The regulator “shall take appropriate action based on outcome of the investigations,” it stated. Nasser Ali Shaban Ahli and Chang Chung-Ling, who OCCRP referred to as “longtime business partners” of the Adani family, were two individual investors who made the investments it looked into for its piece and were mentioned in the organization’s news report on Thursday. Although the media outlet claimed there was no proof Chang and Ahli’s funds for their investments came from the Adani family, it claimed that documents such as an email, corporate records, and an agreement showed there “is evidence” that their trading in Adani stock “was coordinated with the family.”
OCCRP Explores the Status of Ahli and Chang in Adani’s Promoter Realm
“The question of whether this arrangement is a violation of the law rests on whether Ahli and Chang should be considered to be acting on behalf of Adani ‘promoters,’ a term used in India to refer to the majority owners of a business,” OCCRP said. If so, according to OCCRP, their ownership interest in Adani would be greater than the 75% threshold for insider ownership. According to the news item, Ahli and Chang did not reply to OCCRP’s requests for comment. Ahli and Chang could not be reached by Reuters for comment right away. In an encounter with a Guardian reporter, Chang claimed, according to OCCRP, that he was unaware of any covert acquisitions of Adani stock. He questioned why media were uninterested in his previous assets and responded, “We are a simple business.”
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