Adani's dollar bond price is at a one-year low in the wake of the US bribery-fraud case. Share prices also fell sharply. Investors are losing faith in this Indian conglomerate. Reducing investment.
Adani Ports and Special Economic Zone bonds fell by 1 cent to 2 cents in Asian trade today. Adani transmission bond sales also fell. The Adani Transmission Bond will mature in May 2036. Its price has decreased by 1.8 cents.
The ports bond will expire in 2027. In the meantime, its price has decreased by 1.6 cents to 88.98 cents. Adani has lost about 7 cents in face value since the allegations against it. Long-term Ports bonds, on the other hand, lost 8 cents to 10 cents in face value.
Apart from this, Adani Group's 10 listed shares, led by Adani Enterprises, lost $27.9 billion in market value.
Among these, Bangladesh has decided to hire a 'reputed international legal and investigative agency' to review major power generation contracts, including the Adani Power Trading Agreement. Even two major projects of the group in Kenya have been cancelled.
Sri Lanka's new government is also reviewing Adani Green Energy Ltd's Mannar and Punriyan wind power projects. There is also a process of examining the financial and environmental impact of the agreements.
In June 2020, a renewable energy company owned by Indian billionaire Gautam Adani secured the largest solar project deal in history. Under this contract, a state-owned power company was promised to supply 8 GW of electricity.
But the problem arose, the local power companies were not interested in paying the price offered by the state-owned company. This puts the implementation of the agreement in jeopardy. According to US authorities, Adani decided to bribe local officials to convince them to buy the power to secure the deal.
US prosecutors allege that Adani Group's billionaire chairman Gautam Adani and seven others agreed to pay $265 million in bribes to Indian government officials to secure solar power contracts. They expected to make $2 billion in profits over 20 years from this deal.
The allegations were made against Adani in a US criminal and civil case published last Wednesday. He is currently not in US custody. He is believed to be staying in India. The Adani Group called the allegation 'baseless' and said it would take 'all possible legal action'.
Under US law, if a company does business in the US and their operations are conducted through US financial institutions, the executives involved can be charged with foreign bribery. The complaint also alleged that Adani tried to hide bribes to mislead US investors.
