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Adani Group Demerging and the Australian Mine Controversy continues

An interesting and absorbing and explosive article on the Adani Group by Lisa Cox has appeared  on February 7,2015 in  The Sydney Morning Herald    

Tax Havens,Criminal Investigation,Secret Ownership,Murky Money Trails…..the article does state that the Indian Media has reported that Company Officials counter these allegations as being “politically motivated” and a bid to resurrect old cases

Wonder if any Indian Media will have the courage to follow up on this SMH post and whether the BSE & NSE will, at least for the record because they simply accept any clarification and post it on their websites and file it and think their job is done for investor awareness and protection!, seek clarification from the Adani Group for all of this …..the article covers quotes from Australian relevant experts of  deliberate Non Disclosures and Dubious Accounting in Annual Reports of AEL and the role and pedigree and emergence of Gautam Adani’s brother,Vinod Shantilal Adani as the pivotal shareholder and sole director in newly created Singapore & Cayman Island Companies that control the Australian Coal Developments  of the Adani Group

The AEL Auditor,Ahmedabad based Dharmesh Parikh & Co has given a clean Limited Review Report of the latest standalone AEL Results 

Just over a week ago  on January 30,2015 the flagship Adani Enterprises Ltd (AEL) announced that the Board has approved the demerger of diversified businesses of the Company  and the merger of one unlisted mining company into AEL 

AEL has been recording 52 Week Highs and closed the week at Rs 627 (FV Rs 1)

Adani Ports & Special Economic Zone Ltd (APSEZL) closed at Rs 300(FV Rs 2)

Adani Power Ltd(APL) closed at Rs 47 (FV Rs 10)

You can observe that the Face Value of  the Equity Share of each listed Adani Company is different which sure comes in handy to obscure valuations efforts by many !

Scheme of Arrangement  to be effective April 1,2015 and process completed by December 31,2015 and approved by all the relevant Adani Group Companies Boards is as below :

  1. Demergers ~ There will be three of them 
  • AEL transferring Belekeri Port Operations and it’s Investment in APSEZL to APSEZL and the latter issuing 14123 Shares to AEL Shareholders for every 10000 shares owned by them and the shares allotted to AEL for it’s 74.99% holding in APSEZL be subsequently cancelled
  • AEL transferring 40MW Solar Power Project at Bitta Village in the Kutch District of Gujarat and it’s Investment in APL to APL and the latter issuing 18596 shares to AEL  Shareholders for every 10000 shares owned by them and the shares allotted to AEL for it’s 68.99% holding in APL be subsequently cancelled
  • AEL transferring Mundra-Zedra transmission line and the investment of AEL in  wholly owned subsidiary Adani Transmissions Ltd(ATL) to ATL with the latter issuing 1 share to Equity Shareholders of AEL for every 1 shares held by them in AEL.The Equity shares held by AEL in ATL will be cancelled.ATL will be listed on BSE & NSE 
        2. Merger ~ AEL’s Wholly Owned  Subsidiary Adani Mining Private Ltd (AMPL) will be merged into it

As far as Coal Mine Operations the viability of  developing the Carmichael Coal Mine in the Galilee Basin in Queensland is being questioned as Coal prices have dropped and there are Environmental & Real Employment Issues being raised.State Bank of India has controversially announced that it would lend support of US $ One Billion to the Adani Group to develop the Australian Mine

Also with India now reallocating Coal Mines in a transparent manner  after the Scandal on the allocation under the UPA Government had set back Coal Mine Development in India for several years there would not be a scenario of India having to import Coal in the years ahead

Should be Interesting to watch how the fortunes of the Adani Group unfolds  in the coming years

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1 thought on “Adani Group Demerging and the Australian Mine Controversy continues”

  1. Tanima Raghuvanshi

    Read your article and really liked it. I am really impressed that you take out time to write so that people like us can have an insight to these fact about government. I would be really glad if you have anything to say about what can be done about it. how can be people made aware? What should oil and gas companies do?

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