Total halts new investment in Adani
New Delhi: French energy giant TotalEnergies SE on Monday said it was not aware of the corruption investigation its partner Adani group’s founder chairman was facing in the US and that it is pausing fresh investments in the conglomerate pending the outcome of the charges.
Separately, GQG Partners, which made huge bets on Adani group post hammering it saw in the aftermath of the Hindenburg Report last year, said the indictment is against individuals only and the bet it made on the group
holds good.
“This indictment does not target AGEL itself, nor any AGEL-related companies,” TotalEnergies said.
“Until such time when the accusations against the Adani group individuals and their consequences have been clarified, TotalEnergies will not make any new financial contribution as part of its investments in the Adani group of companies.”
TotalEnergies holds a 19.75 per cent stake in Adani Green Energy Ltd - the renewable energy arm of the Indian group helmed by Gautam Adani. It also has a 50 per cent stake in three joint venture companies that produce electricity from sunlight and wind with AEGL. TotalEnergies also holds a 37.4 per cent stake in Adani Total Gas Ltd, which retails CNG to automobiles and pipes natural gas to households for cooking.
“In accordance with its code of conduct, TotalEnergies rejects corruption in any form,” the French giant said in the statement. “TotalEnergies, which is not targeted nor involved in the facts described by such indictment, will take all relevant actions to protect its interests as a minority (19.75 per cent) shareholder of AGEL and as a joint-venture partner (50 per cent) in project companies with AGEL.”
GQG, whose exposure to Adani group companies stands at $8.1 billion, said, “On a fundamental business case, we continue to believe each individual company is well-positioned for the future”.
“Our investments in Adani as of November 21 have had positive returns in aggregate for our portfolios,” GQG said in a note. The bribery allegations, it said, relate only to AGEL, not other Adani companies. “While the allegations are serious, there are many examples of global companies and their executives who have faced significant government action,” it said. “These actions and investigations typically take years to resolve and may yield reduced penalties or fines.” Except for AGEL, GQG did not see any other Adani group company needing additional financing at this point.
