New Delhi: The Morning Context has reported on the lack of clear acknowledgment by the Adani Group in its official reports on the fact that a key ‘unknown’ investor in its railway project in Australia is actually a Singapore-based company headed until this February by Gautam Adani’s older brother, Vinod.
The report notes that the railway project was originally housed under Carmichael Rail and Port Singapore Holdings Pte, the firm Vinod was a Director of. The railway line from this project was to connect the Carmichael coal mine in Queensland to the Abbot Point port.
But, the report says, in its annual reports since 2017, Adani Enterprises “painted a confusing picture of its ownership” of Adani Global Resources Pte or AGRPTE and, by extension, the Carmichael rail project.
“While it says that it has a 100% shareholding in AGRPTE, it also discloses it as a joint venture with 50% effective ownership. Accordingly, it reports a 50% ownership of the Australian rail project entities. There is no further information in the annual reports on why this is so.”
The companies annual reports show that the unknown investor holds a convertible note, which gives them the right to convert debt into equity.
Adani Enterprises had not revealed such a presence earlier. But in a response to The Morning Context’s questions on May 8, it told the outlet that it was Carmichael Rail and Port Singapore Holdings, the same entity from which the project was acquired by Adani Enterprises.
The decision to hide this information on who Adani Enterprises’ partner was in such a major infrastructure project points to the group shirking the “greater responsibility of clarifying the arrangement to investors and revealing who the noteholder is.”
Experts told Morning Context that a foreign subsidiary’s dealings can be disclosed as per the rules of the land where it is operating.
There is still not enough clarity on whether AGRPTE is a 100% or a 50% Adani-owned entity. Adani Enterprises has described it as both in its annual reports.
In addition, the report points out that in Singapore, neither Adani Global Pte nor Adani Global Resources Pte refer to their connection as a joint venture with 50% interest. Adani Global reports 100% equity holding in AGRPTE in its 2019 and 2021 fiscal year reports. “Notably, it does not list AGRPTE in its list of joint ventures,” the report says.
The outlet also did not find mention of the noteholding in Adani Enterprises’s related party transactions for 2017-18. Nor did it find any information on the note’s issuance or its holder’s identity in its subsequent annual reports.