Gautam Adani Bribery Case: Adani Wilmar Likely To Defer Stake Sale Amid US Bribery Allegations; Reports

Adani Enterprises Ltd and Wilmar International Ltd are reportedly postponing a planned sale of at least 12% in their joint Indian food venture, Adani Wilmar Ltd, in light of a US bribery indictment involving Gautam Adani, the founder of the Adani Group. The decision comes as the conglomerate grapples with the fallout from the allegations and faces challenges in meeting regulatory requirements within the stipulated timeline.

Compliance Deadline at Risk

Adani Wilmar, an equal joint venture between India's Adani Group and Singapore-based commodity trading giant Wilmar International, was gearing up to initiate the stake sale this month. The move aimed to comply with local securities regulations mandating that at least 25% of a company's holding be held by non-founders within three years of its listing.

Since Adani Wilmar's listing in 2022, its majority owners have retained a combined 86.8% stake, significantly exceeding the regulatory cap of 75%. The company must reduce its promoter shareholding to meet the requirements by February 2025. However, the bribery allegations have made it "extremely difficult" to conduct the sale before the deadline, according to sources familiar with the matter.

Adani Wilmar plans to seek an extension from India's Securities and Exchange Board of India (SEBI), insiders revealed, requesting anonymity due to the sensitivity of the matter. The company's representatives and advisers are said to be evaluating the implications of the bribery indictment, which has cast a shadow over the conglomerate's activities.

The impact of the bribery allegations has already been felt in the stock market. Shares of Adani Wilmar were trading down 2% at Rs 291.45 on the National Stock Exchange (NSE) as of 2:40 pm on Tuesday. Over the past year, the stock has delivered negative returns of approximately 8%, with a sharper decline of 18% recorded in 2024.

Adani Wilmar, best known for its "Fortune" brand of cooking oils, wheat flour, and other food products, is one of India's largest food product manufacturers.

Fallout from Bribery Allegations

The bribery scandal erupted after US federal prosecutors last week indicted Gautam Adani and his associates in connection with a $250 million bribery scheme. The Adani Group has strongly denied the allegations, labelling them as baseless and vowing to seek legal recourse.

The indictment has already prompted reactions from key business partners. France's TotalEnergies SE, an equal stakeholder in Adani Total Gas Ltd., announced on Monday that it would halt any new investments in the Adani Group until the implications of the US indictment are clarified.

The decision to defer the stake sale is yet another setback for the Adani Group, which has faced increased scrutiny from global markets and regulatory authorities. The conglomerate, led by Asia's second-richest man, now faces the dual challenge of clearing its name and adhering to India's regulatory mandates.