FT & RaGa: The Adani Group debunks claims, says it raised Rs.20k cr legally
Virendra Pandit
New Delhi: Refuting claims made recently by London-based Financial Times, which Congress leader Rahul Gandhi relied upon in his ongoing political battle against business tycoon Gautam Adani and Prime Minister Narendra Modi, the Adani Group said it had raised USD 2.7 billion (over Rs 20,000 crore) by the sale of equity in two Adani companies to Total Gas of France.
All the transactions were publicly disclosed in stock exchange filings, it said.
Countering the FT’s report, the Adanis said the story “incorrectly mixed primary and secondary investments” and also ignored entirely a secondary transaction of USD 2 billion “so that the reporters could conveniently create an illusion of gap in funding to support their pre-conceived thesis of supposed round-tripping”.
Quoting the FT report, Gandhi had claimed that Rs.20,000 crore had suddenly arrived in the Adani Group’s “shell companies.”
Responding to the article, “Indian Data Reveals Adani Empire’s reliance on offshore funding”, the Group said it had raised USD 2.7 billion by the sale of equity in two Adani companies to Total Gas of France. These funds were reinvested in other Adani companies.
Besides, the promoters’ substantial holdings in Adani companies increased over time. “It is through the timely use of funds received through the sale of equity that these entities have been able to increase their investments,” it said.
“We understand the competitive race to tear down Adani can be alluring. But we are fully compliant with securities laws and are not obscuring promoter ownership and financing,” said the Group while asking FT to take down the story which has caused misunderstanding in the market and has become a political issue.
The Adani Group listed details of the USD 2.87 billion stake sales in its firms since 2019 and how USD 2.55 billion of this was ploughed back into the business.
While investors such as Abu Dhabi-based global strategic investment company, International Holding Company PJSC (IHC) invested USD 2.593 billion in Adani Enterprise Ltd and Adani Green Energy Ltd (AGEL), promoters sold the stake in Adani Total Gas Ltd and AGEL to raise USD 2.783 billion.
“These funds were reinvested by promoter entities to support the growth of new business and in portfolio companies such as Adani Enterprises Ltd, Adani Ports and Special Economic Zone Ltd, Adani Transmission Ltd, and Adani Power Ltd,” the Group said.
It said promoters in January 2021 raised USD 2 billion through the sale of a 20 percent stake in renewable energy firm, AGEL to French giant TotalEnergies. Prior to that, they had sold a 37.4 percent stake in the city gas arm, Adani Total Gas Ltd, to the same French firm for USD 783 million.
It said the funds came from the sale of a stake in Adani Total Gas. Also, they weren’t obscure entities because they are promoter-held.
France’s TotalEnergies bought overseas investment vehicles of the promoters to make some of those investments, and the funds so received overseas were ploughed back into Group entities, which is now being termed by some as investment by ‘shell companies.’
Also, “the Adani family deployed its returns from the secondary sale to make additional purchases of AGEL equity and to provide support to AGEL via a shareholder loan and other securities – all also in the public domain,” it said.
The Adani Group said it had publicly disclosed all details and reportage on the investment of funds into group companies that had incorrectly mixed primary and secondary investment.
“The facts are easily available and transparent. They are available through relevant securities regulatory filings that were made at the time and are a matter of public record,” it said, adding the “misleading narrative” has become a “regrettable” political issue.
