Indian mining magnate Gautam Adani has slipped out of the top 10 of the world’s richest people after a horror few days for his company.
In the past week, Mr Adani has watched on as his empire plunged by more than $US70 billion ($A99 million) in market value amid a mass, panicked sell-off from investors.
It followed India’s $US218 billion ($A309 billion) Adani Group being slammed by US activist investment group Hindenburg Research, for purportedly carrying out fraud for years on end.
The Hindenburg research group has accused the Adani group of “brazen accounting fraud, stock manipulation and money laundering at Adani, taking place over the course of decades” which they also said they had proof for.
Hindenburg also revealed it had taken a short position in Adani Group – meaning it is betting that the company’s stock price will plunge.
The Adani group hit back quickly, denying the allegations and accused Hindenburg of being “malicious” in a detailed 413-page rebuttal but it did little to stop the share price from tanking.
Mr Adani’s personal fortune hasn’t entirely managed to weather the storm either, with the billionaire dropping down from third to 11th position on the Bloomberg Billionaire’s Index.
The 60-year-old’s net worth went from $US119.5 billion to $US84.4 billion ($A169 billion to 119.6 billion), wiping off an eye-watering $35.1 billion ($A49.7 billion).
It comes as on Wednesday morning,The Sydney Morning Herald revealed that Australia’s corporate regulator, the Australian Securities and Investments Commission, is reviewing the Hindenburg report.
The Adani group also lashed the timing of the explosive report, which came just before a $US2.5 billion ($3.52 billion) share sale.
On the first day the news broke, $US12 billion ($A16 billion) was erased from Adani’s mining business, and trading paused on Thursday because of an Indian public holiday.
Then on Friday, a further $US50 billion ($A70 billion) was wiped away.
The eye-watering loss came after his flagship firm, Adani Enterprises, dropped by 19 per cent while Adani Green Energy and Adani Total Gas declined by 20 per cent.
By Tuesday, shares in Adani Total Gas were down 10 per cent compared to the day before.
An Abu Dhabi firm called International Holding Company (IHC) poured a $US400 million ($A567 million) investment into Adani but even that didn’t shore up the mining empire or stop its decline.
On Sunday, the mining company released a lengthy rebuttal to save face.
In the document, Adani said what had happened was “nothing short of a calculated securities fraud under applicable law”.
The firm responded to 65 of the explosive 88 questions posed by the Hindenburg group, noting: “Not one of these 88 questions is based on independent or journalistic fact finding. “They are simply selective regurgitations of public disclosures or rhetorical innuendos colouring rumours as fact.”
Hindenburg’s bombshell report included claims such as, “The Adani Group has previously been the focus of four major government fraud investigations which have alleged money laundering, theft of taxpayer funds and corruption, totalling an estimated $US17 billion ($A24 billion).
“Adani family members allegedly co-operated to create offshore shell entities in tax-haven jurisdictions like Mauritius, the UAE, and Caribbean Islands, generating forged import/export documentation in an apparent effort to generate fake or illegitimate turnover and to siphon money from the listed companies.”
Hindenburg said its two-year investigation “involved speaking with dozens of individuals, including former senior executives of the Adani Group, reviewing thousands of documents, and conducting diligence site visits in almost half a dozen countries”.
For more latest Economy News Click Here