Adani Green: No new deals with TotalEnergies, growth plans unaffected

A day after French energy giant TotalEnergies said it would not make any new financial contribution as part of its investments in Adani entities until the accusations are clarified, Adani Green Energy Ltd has said there is no new financial commitment under discussion with TotalEnergies. "Hence, the Press Release (of TotalEnergies) will not have any material impact on the company’s operations or its growth plan," the company says in an exchange filing today.

Adani Green Energy Ltd shares are trading 6.96% down at ₹900.30 on the BSE today, with its m-cap at ₹1,42,610.44 crore.

TotalEnergies owns a 19.75% stake in Adani Green Energy. The French petroleum major TotalEnergies said on Monday that U.S. authorities’ indictment of certain individual Adani group executives in relation to an alleged corruption scheme linked to the business of Adani Green Energy Ltd (AGEL) does not target AGEL itself, nor any AGEL-related companies.

TotalEnergies, which is not targeted nor involved in the facts described by such indictment, said it would take "all relevant actions" to protect its interests as a minority (19.75%) shareholder of Adani Green Energy and as a joint-venture partner (50%) in project companies with AGEL.

Global ratings agency Fitch, meanwhile, has put a few Adani group bonds on ratings watch amid a $265 million bribery indictment case in a U.S. court. Fitch Ratings placed Adani Energy Solutions' (AESL) long-term foreign-and-local-currency issuer default ratings of 'BBB-' and the 'BBB-' ratings on Adani Electricity Mumbai Ltd's (AEML) senior secured notes on rating watch negative (RWN).

"The 'BBB-' ratings on the notes issued by AESL's subsidiary, Adani Transmission Step-One Limited, have also been placed on RWN. The rating actions follow the bribery charges and indictment of certain board members of Adani Green Energy Ltd (AGEL) by the U.S. Securities and Exchange Commission and Department of Justice," Fitch said.

One of Adani's biggest backers, GQG Partners, a U.S.-based investment boutique and a major backer of the Adani Group, has also come out with a statement that it does not see US actions having a "material" impact on Adani businesses. “We believe this level of exposure is manageable, even given the volatility in Adani Group stocks,” said GQG.

However, the American investment firm said it would remain diligent in re-underwriting its positions and examining any new facts. GQG's holdings in Adani Group companies dropped from $9.7 billion on November 19 to $8.1 billion on November 21, now representing 5.2% of its total assets of $156.7 billion, as per the memo.

Adani Group has said it would respond to bribery allegations levelled by the U.S. government after reviewing the charges in detail and seeking counsel approval as the matter is "sub-judice."

Jugeshinder Robbie Singh, the chief financial officer of Adani Group, said the allegations specifically relate to one contract of Adani Green Energy, which is roughly 10% of the overall business of Adani Green. "There is a lot more precise and comprehensive detail of this which we will elaborate on in an appropriate forum," Singh said. The group had earlier dismissed the allegations, made by the US Department of Justice and the SEC against Gautam Adani and nephew Sagar Adani, as "baseless".