The Adani Group has vehemently on Thursday dismissed the Organised Crime and Corruption Reporting Project (OCCRP)'s allegations that hundreds of millions of dollars were invested in publicly traded group stocks through Mauritius-based 'opaque' investment funds managed by partners of promoter family.
The fresh allegations by OCCRP, which is funded by George Soros and Rockefeller Brothers Fund, come seven months after US-based short seller Hindenburg Research wiped away close to $150 billion in value of Adani Group stocks with explosive allegations. The conglomerated has denied all Hindenburg allegations.
What is OCCRP?
OCCRP is a global network of investigative journalists which "exposes crime and corruption so the public can hold power to account." The organisation is formed by 24 non-profit investigative centres in Europe, Africa, Asia and Latin America.
Who are the two mysterious investors?
OCCRP, which cited review of files from multiple tax havens and internal Adani Group emails, said its investigation found at least two cases where the "mysterious" investors bought and sold Adani stock through such offshore structures.
The two investors were identified as Nasser Ali Shaban Ahli and Chang Chung-Ling, who OCCRP claimed have longtime business ties to the Adani family. The duo were also directors and shareholders in the firms associated with Gautam Adani's elder brother Vinod Adani.
OCCRP says the two men "spent years buying and selling Adani stock through offshore structures that obscured their involvement - and made considerable profits in the process." The documents "show that the management company in charge of their investments paid a Vinod Adani company to advice them in their investment", it alleged.
OCCRP reported that “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 holding and its affiliated parties. If so, their stake in the Adani Group would mean that insiders altogether owned more than the 75 percent allowed by law.”
It went on to state that there was no evidence Chang and Ahli's money for their investments coming from the Adani family, but said its investigation showed there "is evidence" that their trading in Adani stock "was coordinated with the family".
Adani rejects allegations
Adani said that OCCRP's claims were "recycled allegations" and dismissed them as "yet another concerted bid by Soros-funded interests supported by a section of the foreign media to revive the meritless Hindenburg report".
"These claims are based on closed cases from a decade ago when the Directorate of Revenue Intelligence (DRI) probed allegations of over invoicing, transfer of funds abroad, related party transactions and investments through FPIs. An independent adjudicating authority and an appellate tribunal had both confirmed that there was no over-valuation and that the transactions were in accordance with applicable law. The matter attained finality in March 2023 when the Supreme Court of India ruled in our favour. Clearly, since there was no over-valuation, there is no relevance or foundation for these allegations on transfer of funds," it said.
The foreign portfolio investors named in the OCCRP report "are already part of the investigation by the Securities and Exchange Board of India (SEBI)", it said. "As per the Expert Committee appointed by the Hon'ble Supreme Court, there is no evidence of any breach of the Minimum Public Shareholding (MPS) requirements or manipulation of stock prices."
"These attempts are aimed at, inter alia, generating profits by driving down our stock prices and these short sellers are under investigation by various authorities. As the Supreme Court and SEBI are overseeing these matters, it is vital to respect the ongoing regulatory process," it said. "We have complete faith in the due process of law and remain confident of the quality of our disclosures and corporate governance standards. In light of these facts, the timing of these news reports is suspicious, mischievous and malicious - and we reject these reports in their entirety."
-- with PTI inputs
