Gautam Adani backs out of $600 million bond deal after US prosecutors file bribery charges

Adani Group has reportedly canceled its $600 million bond offering after US prosecutors charged Gautam Adani in connection with a $250 million bribery scheme. The accusations sent shock waves through markets, causing Adani’s US dollar-denominated bonds to fall in Asian trading.

Adani Group shelved the bond sale a few hours after pricing it, following statements from the US Department of Justice and the Securities and Exchange Commission. The allegations allege that Adani and other executives bribed Indian officials to secure lucrative solar energy contracts.

Existing Adani Green Energy bonds issued in March fell a record 15 cents to 80 cents on the dollar. Other securities of Adani Group fell sharply, with losses rivaling those triggered by last year’s Hindenburg Research report, which accused the company of stock manipulation and accounting fraud.

“While Adani has dodged the Hindenburg allegations, these accusations highlight ongoing governance and regulatory risks,” Singapore-based SGMC Capital Pte fund manager Mohit Mirpuri said in the Bloomberg report.

The indictment filed in Brooklyn alleges that Adani and other executives misled investors while raising funds from US markets. Among the notable names mentioned are Sagar Adani and Vneet Jaain, who are accused of violating federal laws.

The group’s reputation has been under scrutiny since the Hindenburg report wiped $150 billion off its market value in 2023. Adani had begun rebuilding investor confidence, but U.S. accusations now threaten to derail those efforts.

Despite the setbacks, Adani Group recently announced plans to invest $10 billion in US energy and infrastructure; this signaled its desire to expand globally despite facing increasing regulatory and market pressures.