Adani Group Faces Global Backlash After U.S. Bribery Indictment | Market Loss & Suspended Deals

India’s Adani Group is facing a major crisis following a bribery and fraud indictment in the United States against its chairman, Gautam Adani. The charges, related to securing contracts for Adani Green Energy through corrupt practices, have sparked a ripple effect across the business world. Despite the company’s strong denial of the accusations, the financial and reputational damage is already significant.

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Since the indictment, Adani Group’s ten publicly listed companies have seen their combined market value drop by around $33 billion. The hardest hit is Adani Green Energy, which alone has lost nearly $9.7 billion in value. The legal troubles have not only affected the stock market but also led to several international business partners rethinking their relationships with the group.

TotalEnergies Freezes Further Investments in Adani Group

French oil giant TotalEnergies has made the decision to stop any further investments in the Adani Group after learning about the bribery allegations. TotalEnergies holds a 20% stake in Adani Green Energy and a 37.4% stake in Adani Total Gas. The company’s decision to halt further investments is a direct response to the lack of transparency about the charges. Following this announcement, shares of Adani Green Energy fell by more than 11%, while Adani Total Gas also saw a decline of 1.4%.

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U.S. DFC Puts Port Project in Sri Lanka on Hold

The U.S. International Development Finance Corporation (DFC), which had previously pledged $550 million for a port development project in Colombo, Sri Lanka, is now reassessing its commitment. The port terminal, which involves a partnership with Adani Group, is under scrutiny as a result of the bribery charges. While the DFC has not made a final decision yet, this move indicates how serious the allegations are, as U.S. agencies reconsider their financial backing for projects linked to the Adani Group.

Sri Lanka and Kenya Pause Adani’s Ongoing Projects

The Sri Lankan government has also stated that it is reviewing all of its ongoing projects with the Adani Group. While the government has yet to make a definitive decision, the bribery charges are being taken very seriously. Sri Lanka’s careful approach reflects how global investors and governments are now reevaluating their business dealings with Adani.

In Kenya, the Adani Group has suffered a similar blow. The Kenyan government has canceled two major deals involving Adani—one worth over $2 billion for expanding Jomo Kenyatta International Airport and another $736 million energy partnership. These decisions come after the bribery charges surfaced, leading to a pause in the Adani Group’s international expansion plans.

Bangladesh Investigates Adani’s Power Contracts

In Bangladesh, authorities have launched an investigation into power generation contracts signed with Adani Power. The Bangladeshi government is concerned about the integrity of these deals, particularly in light of the bribery charges. A government committee has suggested that an international legal firm be hired to ensure the contracts are thoroughly examined for any potential wrongdoing.

Andhra Pradesh Considers Canceling Adani Power Contract

In India, the state government of Andhra Pradesh is reviewing a significant power supply contract with the Adani Group. According to the U.S. indictment, the group allegedly paid over $265 million in bribes to secure solar power contracts, with Andhra Pradesh reportedly receiving the largest share of the bribe. The potential cancellation of this contract highlights the ongoing impact of the bribery allegations on Adani’s operations at home.

Financial Fallout: Market Value Shrinks as Investor Confidence Wanes

The fallout from these bribery allegations has had a visible effect on Adani Group’s market value. Since the charges were brought to light, the group’s publicly traded companies have lost billions of dollars in market capitalization. The steep drop in share prices reflects growing concern among investors about the group’s future prospects and the long-term effects of the ongoing legal issues.

With major international partners pulling back and a series of high-profile projects on hold or canceled, the Adani Group is facing a period of uncertainty. The company has denied all allegations, but the damage to its reputation and financial standing is undeniable. The question now is how the group will recover from this crisis and regain the trust of investors, governments, and business partners around the world.

What’s Next for the Adani Group?

As the Adani Group navigates these turbulent waters, the road ahead looks challenging. The company’s ability to rebuild its image and restore confidence in its business dealings will be crucial in determining its future. While the group continues to defend its position, the ongoing investigations and the reaction from global partners will likely have a lasting impact on its reputation and financial standing.

As the situation unfolds, stakeholders from all corners of the globe will be watching closely to see how Adani Group responds to these serious allegations and the broader impact on its international operations.

Also Read: Adani CFO Addresses U.S. Bribery Allegations, Says Only One Contract is Affected