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Adani Group has hired top lawyers at New York’s Wachtell, Lipton, Rosen & Katz to fight back allegations of stock manipulation and accounting fraud levelled by Hindenburg Research.
Indian billionaire Gautam Adani has hired a New York-based powerful activism defence law firm as he looks to rebuild investor confidence in wake of a damning report that pulled down his conglomerate’s market values by nearly half.
According to a Financial Times report, the Adani Group has hired top lawyers at New York’s Wachtell, Lipton, Rosen & Katz to fight back allegations of stock manipulation and accounting fraud levelled by Hindenburg Research.
In late January, Hindenburg accused the port-to-energy conglomerate of “pulling the largest con in corporate history” – a charge denied by the Adani Group.
Wachtell is considered one of the most expensive law advisors in the United States. It has been among the most sought-after law firms by embattled corporate groups desperate to ward off activist investors.
Since the publication of the Hindenburg report, the Adani Group has been facing severe political and financial pressure at home as well as abroad.
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Earlier this week, the global index provider Morgan Stanley Capital International (MSCI) changed its ratings for many stocks in the Adani Group companies following a review of their availability in the market. Adani repaid a USD1.1 billion share-backed loan after facing a margin call of over USD500 million.
The US law firm was contacted by the group’s India-based Cyril Amarchand Mangaldas – the firm which is at the forefront of defending the industrial giant.
Wachtell is now working to gather more advisory support for Adani, including crisis communication firms, the FT reported, citing sources.
Since January 24 when the report was published, Adani has lost half of his net worth amid a stock rout that saw several of his company shares tanking by more than 50 per cent over several trading sessions.
Adani was the third richest person in the world with his net assets pegged at USD120 billion. Within a week, he fell to the 22nd position in the Forbes’ real-time billionaires’ list and has been jostling for upper ranks.
In India, Opposition parties stalled the ongoing budget session of parliament to press their demand for an investigation either by a joint parliamentary committee (JPC) or a Supreme Court-monitored panel.
In its defence, the Adani Group – whose interests range from ports, cement, and energy to media – has called the report a “calculated attack on India”.
