US allegations force TotalEnergies to defer investments in Adani Group

In signs that the US Justice Department’s accusation of corruption by the Adani Group has its intended impact elsewhere, French oil major TotalEnergies has said it will wait for clarity on the corruption charges before finalising any further investment in its joint venture with the Adani Group.

TotalEnergies is a junior partner in Adani Green Energy Ltd (AGEL) with 19.75 per cent stake and is equal partner in some downstream ventures of the joint venture.

Total said as per public announcements made by the US authorities, DoJ has accused certain Adani group executives in relation to an alleged corruption scheme linked to the business of Adani Green Energy Limited (AGEL). 

However, Total said the indictment does not target AGEL or any of its related companies, adding that TotalEnergies is totally against corruption, in any form.

While, the company will do everything to protect its minority interest in AGEL and its interests in related entities, TotaiEnergies said it will also desist from making any fresh investment in the Adani ventures until when the allegations against Adani Group representatives are clarified.

TotalEnergies said its investments in Adani Group companies are in full compliance with the laws, and its own internal code and after making due diligence on the Adani group, which did not reveal the existence of any investigation into the alleged corruption scheme.

Prices of Adani Green Energy shares also dropped nearly 8 per cent on Tuesday to Rs893, following the statement by TotalEnergies.

Prices of Adani dollar bonds also fell as investors cut exposure to the securities in the wake of DoJ allegations of corruption at the group.

According to DoJ, Adani Group chairman Gautam Adani and seven other people have agreed to pay around $265 million in bribes to government officials in India.

The US prosecutors have alleged that the bribes paid to government officials were to secure contracts that would yield over $2 billion in profits over a 20-year period.

Adani Group has said the allegations of corruption levelled by US agencies are baseless and said it will seek "all possible legal recourse".

Further, a US development agency, which had agreed to lend $550 million to an Adani-backed port project in Sri Lanks, announced a review of the agreement in the wake of the bribery allegations.