These two business tycoons bought Adani shares amid short seller fight

At least two of India’s biggest business families participated in Adani Enterprises Ltd.’s $2.5 billion share sale, according to people familiar with the matter, in a sign of solidarity with Gautam Adani as the tycoon fights short seller allegations that sent the value of his empire plummeting.

Tycoons Sajjan Jindal and Sunil Mittal subscribed to the follow-on offering in a last-minute push that helped Adani’s flagship firm complete the sale on Tuesday, said the people, who asked not to be identified as the information is not public.

The investments come from their personal funds and do not involve listed businesses that they helm like JSW Steel Ltd. and Bharti Airtel Ltd., the people said. Jindal has invested about $30 million, according to one of the people familiar. It’s unclear how much Mittal bought in.

Representatives for Jindal’s JSW and Mittal’s Bharti declined to comment on the founders’ possible investments in Adani share sale. Adani Group representatives did not offer any immediate comment. Indian newspaper Business Standard reported Jindal and Mittal’s participation.

The offering was India’s largest follow-on share sale, and was fully subscribed on the final day, aided by a surge in demand from institutional investors and high net-worth individuals. Interest from retail investors — who billionaire Adani was hoping to attract to diversify firm’s investor base — was notably weak.

The participation by some of India’s biggest corporate names, some with potentially rival business interests, comes as the Hindenburg Research allegations against Adani are seen by some domestically as threatening the country’s economy at large.

Attack on India
Hindenburg alleged the Adani group used a web of firms in tax havens to inflate revenue and stock prices. The Adani group labeled the short seller’s allegations an “attack on India, the independence, integrity and quality of Indian institutions, and the growth story and ambition of India.”

The ports-to-power conglomerate, which has been on a breakneck expansion and diversification spree, has lost more about $70 billion in its market value since the Hindenburg published the report last week. The sell off pushed Adani Enterprises’ stock below the follow-on offer’s floor price. The share sale was then bolstered by existing Adani shareholder Abu Dhabi’s International Holding Co., which invested $400 million in the offering.

The Adani Group has called Hindenburg’s report “bogus,” threatened legal action and said it was “a calculated securities fraud” on Sunday in a 413-page rebuttal, which the short seller said ignored all its key allegations and was “obfuscated by nationalism.”