TotalEnergies says its Adani investments are in compliance with Indian laws
France’s TotalEnergies on February 3 said that its investments in Indian Adani’s entities were undertaken in full compliance with Indian laws, and with its own internal governance processes.
“The due diligence, which were carried out to TotalEnergies’ satisfaction, were consistent with best practices, and all relevant material in the public domain was reviewed, including the detailed disclosures to regulators required under applicable laws,” the French major said. “TotalEnergies welcomes the announcement by Adani to mandate one of the "big four" accounting firms to carry out a general audit.”
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US-based short seller Hindenburg Research last month published a report alleging stock manipulation by the Adani Group and raised concerns about valuations and high debt.
TotalEnergies has 50% stake in Adani Total Private, 37.4% stake in Adani Total Gas, 19.75% in Adani Green Energy and 50% stake in AGEL23.
In 2018, TotalEnergies and Adani Group embarked on an energy partnership with the development of a joint LNG business, Adani Total Private, which aims to develop the Dhamra LNG regasification terminal. The project is expected to start operations in Q2 2023. The joint venture is also involved in marketing LNG.
In 2019, TotalEnergies announced the acquisition of a 37.4% stake in the listed entity Adani Total Gas, a city gas distribution business. As of end 2022, the business operated 33 city gas licenses and some 380 CNG stations.
In 2020, TotalEnergies and Adani Group extended their relationship, with the acquisition by TotalEnergies of a 20% minority interest in the listed company Adani Green Energy, and a 50% stake in a 2.35 GWac portfolio of operating solar assets owned by AGEL23, for a total investment of $2.5bn.
“The entities TotalEnergies has invested in with Adani are managed in accordance with applicable regulations,” the company said, adding that the day-to-day operations of the entities listed in India are managed by independent teams of professional managers, and their boards are composed of at least 50% independent and non-executive directors.
TotalEnergies said its exposure resulting from these stakes is limited, as it represents 2.4% ($3.1bn at December 31, 2022) of the company’s capital employed and $180mn of net operating income in 2022.