Over a month after Hindenburg Research alleged that Gautam Adani's elder brother Vinod Adani managed a network of offshore entities to facilitate fraud at Adani Group, a report on Monday claimed that he also controls entities that own Ambuja Cements and ACC. Adani Group does not own the two cement companies that it bought last year, the Morning Context said in a report on Monday.
In September last year, Adani Group informed that it had acquired Ambuja and ACC from Swiss cement major Holcim for $10.5 billion, becoming the country's second-largest cement manufacturer after Aditya Birla Group's UltraTech Cement. For the transaction, the Adani Group created a special-purpose vehicle called Endeavour Trade and Investment Ltd. The group mentioned this in its statement issued after the deal.
However, now the report claims that this entity is based in Mauritius and owned by Vinod Adani. "This means neither Adani Enterprises nor any of the Adani group's other listed companies in India or their subsidiaries acquired Ambuja Cements/ACC," the report said, adding that though group chairman Gautam Adani projected to the world at large and shareholders that it was the Adani Group of companies which acquired the cement companies.
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The Adani Group is already under heavy scrutiny for fraud claims made by US-based short-seller Hindenburg Research. In its scathing report published on January 24, the short-seller claimed that the Indian conglomerate was engaged in a "brazen stock manipulation" and "accounting fraud".
The Hindenburg report, which caused mayhem in Adani group stocks, claimed that Vinod Adani managed a vast labyrinth of offshore shell entities for Gautam Adani. The short-seller also said that it identified 38 Mauritius-based shell entities controlled by Vinod Adani or his close associates. Adani Group, however, rubbished the claim saying Vinod Adani did not have any role in group companies' day-to-day affairs.
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Today, the report said that rather than using a direct overseas subsidiary, the Adani Group used a network of offshore entities to acquire Ambuja Cements and ACC. "It has now emerged, according to the final offer letter issued by Ambuja Cements, that the ultimate beneficial owner of Endeavour is 'Mr Vinod Shantilal Adani and Mrs Ranjanben Vnod Adani' through entities based in Mauritius, Dubai, and the British Virgin Islands," the report said.
The report was immediately picked up by TMC MP Mahua Moitra, who has been targeting the embattled group and the central government for no action against Adani by market regulator Sebi. She, in a tweet, said: "'The Adani group does not own Ambuja Cements and ACC' - Deception of the highest order. One cannot make this stuff up. @SEBI_India and @CCI_India would have been provided all details!"
In another tweet, the TMC leader said Ambuja Cements reportedly had Rs 9,829 crore cash and cash equivalents on its books at the end of December 2022. "Am very keen to see cash position & related party (or rather suspicious) transactions of Ambuja Cements at end of this month! Kitna gayab aur kisko gaya!" she said.
Sharing the details of the deal with Holcim, Adani Group in its statement said that the transaction was financed by facilities aggregating to $4.50 billion availed from 14 international banks. Barclays Bank PLC, Deutsche Bank AG, and Standard Chartered Bank acted as original mandated lead arrangers and book-runners to the transaction.
On January 29, Adani Group came out with a detailed report and responded to charges against Vinod Adani. It said: "Vinod Adani does not hold any managerial position in any Adani listed entities or their subsidiaries and has no role in their day-to-day affairs. As such, these questions (related to Vinod Adani) have no relevance to the entities in the Adani portfolio."