By PR Sanjai and Eltaf Najafizada
The Adani Group will not release a detailed response to allegations by US short seller Hindenburg Research until after the completion of a new share sale that is expected to close on Jan. 31, according to people familiar with the matter.
The conglomerate owned by Asia’s wealthiest Gautam Adani said it would provide a detailed rebuttal on Friday, according to bondholders attending a conference call with Adani executives. While some questions were answered, the longer answer didn’t materialize as expected.
The group has prepared a more than 100-page response and is also asking for legal advice on when to release it, one of the people said, asking not to be identified because the information is private. Although it won’t be before January 31, people didn’t specify when the answer would come.
A representative for the conglomerate declined to comment.
Also read | MSCI seeks feedback from the Adani Group on the Hindenburg Report
Hindenburg released his report just days before the billionaire’s flagship Adani Enterprises Ltd launched India’s largest-ever secondary IPO, which is expected to raise Rs 20,000 crore ($2.5 billion). It was to finance investments and repay the debts of its various entities.
Hindenburg claimed his two-year investigation found the Adani Group “to be involved in a brazen stock manipulation and accounting fraud scheme over the decades,” citing the conglomerate’s “substantial indebtedness.” The company said it shorts the Adani Group through US-traded bonds and non-India-traded derivatives and that its report “refers solely to the valuation of securities traded outside of India.”
The group lost more than $50 billion in market value in two sessions, costing Adani himself more than $20 billion, or about a fifth of his total wealth, according to the Bloomberg Billionaires Index.
The Adani Group said Thursday it was considering legal action against the research firm, calling Hindenburg’s report “maliciously mischievous,” “false,” and “unresearched.”