Adani Group in focus on reports of prosecutors considering dropping charges; Stocks give up gains

Shares of Adani Group companies, Adani Enterprises Ltd., Adani Ports Ltd., Adani Green Energy Ltd., Adani Energy Solutions Ltd., Adani Power Ltd., opened higher on Friday, May 15, after multiple reports suggested that the US authorities are moving to resolve the fraud charges against Gautam Adani and end a criminal case. However, the stocks soon gave up their gains to trade with losses.

According to a New York Times report, citing people with knowledge of the matter, the US Justice Department is planning to drop charges which had indicted Adani in the final weeks of the Joe Biden Administration, which prosecutors described as an "elaborate bribery scheme involving corruption and fraud at the expense of US investors."

The report states that the move comes after Adani hired a new legal team led by Robert J. Giuffra Jr., one of the personal lawyers of US President Donald Trump and the co-Chairman of the prominent firm Sullivan & Cromwell.

In a meeting held at the US Justice Department Headquarters last month, a proposal was made by the legal team that if prosecutors dropped charges, Gautam Adani will be willing to invest $10 billion in the US economy and create 15,000 jobs, according to the report, which went on to add that Giuffra also aimed to resolve parallel civil cases against Adani brought by the US Securities & Exchange Commission and a separate investigation by the US treasury department.

Both these agencies are now preparing to strike settlements with Adani and impose financial penalties, NYT stated citing sources familiar with the deals.

A separate report from Bloomberg states that Adani is in talks over a potential settlement ranging between $15 million to $20 million of a civil fraud case brought by the US SEC and others in November 2024.

The Adani Group is also nearing an agreement to pay nearly $275 million to settle a separate Office of Foreign Assets Control probe, according to the Bloomberg report, citing people in the know.

After Donald Trump's election win in 2024, Gautam Adani had congratulated the President and had pledged to invest $10 billion in US energy and infra projects.

In its case, the US Justice department had alleged that Adani and others had promised bribes to Indian government officials to win solar energy contracts and concealed the plan as they sought to raise money from US investors.

Shares of Adani Enterprises had ended 9% higher on Thursday after a block deal saw GQG sell a part of its stake, which was lapped by SBI Mutual Fund. The stock is up 27% in the last one month.

Shares of Adani Ports are up 18% in the last one month and are near a 52-week high, while those of Adani Power, Energy Solutions and Green Energy are up 23%, 13% and 30% respectively during the same period.