Adani Group mulls suing US short-seller for fraud claims

NEW DELHI (AP) — India’s Adani Group launched a share offering for retail investors Friday as it mulled taking legal action against U.S.-based short-selling firm Hindenburg Research for allegations of stock market manipulation and accounting fraud that caused heavy selling of its stocks this week.

Jatin Jalundhwala, head of the Adani group’s legal department, said late Thursday that the group “was evaluating the relevant provisions under U.S. and Indian laws for remedial action against Hindenburg Research.”

``Clearly, the report and its unsubstantiated contents were designed to have a deleterious effect on the share values of Adani Group companies as Hindenburg Research by their own admission, is positioned to benefit from a slide in Adani shares,” Jalundhwala said.

Hindenburg’s report has prompted investors to dump Adani Group shares, wiping out billions of dollars' worth of market value.

Jalundhwala said the allegations were an attempt by Hindenburg to sabotage Adani’s share offering. Hindenburg Research said in a rebuttal that it would welcome legal action by the Adani group.

“We fully stand by our report and believe any legal action taken against us would be meritless," it said in a statement.

Adani made a vast fortune mining coal as energy-hungry India grew swiftly after its economy was liberalized in the 1990s. Businesses in the conglomerate span industries including construction, data transmission, media, renewable energy, defense manufacturing and agriculture.

The market value of Adani's companies has soared in recent years, one of the reasons Hindenburg said it judged the seven key Adani listed companies to have an “85% downside, purely on a fundamental basis owing to sky-high valuations.”

Its report, “Adani Group: How the World's 3rd Richest Man is Pulling...