New Delhi: Australia’s corporate regulator will be reviewing the report by US short-seller Hindenburg Research that accuses the conglomerate Adani Group of improper and extensive use of entities set up in offshore tax havens and expresses concern about high debt levels, reports say.
The Adani group, through its Australian division Bravus has significant business in Australia – it operates a coal mine in Queensland and controls a key port and export terminal. The group has said that it “refutes all allegations” made in the short-seller’s report.
The Sydney Morning Herald has reported that while the Australian Securities and Investments Commission and the country’s Tax Office declined to confirm to it if it was looking at the Hindenburg report, sources who sought to remain anonymous confirmed that the regulator was reviewing it.
The Commission’s spokesperson, however, told Reuters that it “will review the allegations against Adani and determine whether further inquiries are warranted.”
Hindenburg’s report came days ahead of a $2.5 billion share offering by Adani Enterprises and sent shares in Adani group firms sliding. On the first day of the offer, only 1% of the shares on sale under Adani Enterprises’ Rs 20,000-crore follow-on public offer (FPO) were subscribed.
The Adani group issued a 413-page response to Hindenburg on Sunday, January 29, claiming that the company had complied with all local laws and made the necessary regulatory disclosures. The short-seller responded by doubling down on its claim that Adani had engaged in fraud, and criticised the fact that Adani’s response attempted to stoke nationalist sentiments.
Companies of the Adani conglomerate have lost billions since the report.
Business Standard has reported that Gautam Adani has, in fact, lost his title of Asia’s richest person as the stocks rout deepened to $74 billion.
Adani has now slipped to the 10th position on the Forbes rich list with an estimated $84.1 billion, just below Reliance’s Mukesh Ambani. Before this, he had been at third.