Barclays, DBS, Deutsche Bank Called Out for Arranging Adani Green Energy Bond with Ties to Coal – EQ

• 11 banks confirmed today as joint bookrunners for Adani Group’s first USD bond since Hindenburg scandal

• Corporate accountability groups Ekō and Banktrack argue investments in Adani Green risk servicing Adani’s vast and expanding coal empire

• Disclosures assessed by Ekō reveal dozens of transactions between Adani Green Energy and Adani Group companies directly involved in coal expansion

Banks announced today as joint bookrunners on Adani’s first USD bond since the Hindenburg scandal risk “supporting coal by stealth”, according to a corporate accountability group. Barclays, DBS and Deutsche Bank are three of the 11 confirmed bookrunners with coal policies which, according to Ekō, should be applied to the Adani Green Energy transaction.

Latest financial disclosures collated by Ekō show 52 related party transactions between Adani Green Energy Limited (AGEL) and other Group companies involved in coal or LNG expansion, including: 19 transfers to Adani Enterprises, which houses assets like the Carmichael coal mine in Australia, and a controversial joint venture building drones for the Israeli Defence Force; 4 transfers to Mundra Petrochem which has recently received project financing for a coal to plastics plant; and 10 transfers combined to Adani Power (15210 MW current installed coal capacity and 7160 MW expansion plans) and Adani Total Gas.

Ekō and Banktrack wrote to 17 banks this month which had previously underwritten Adani bonds. The letter urged them to reject approaches to arrange the March AGEL bond deal and consider AGEL as no different from any other subsidiary of the world’s largest private coal developer.

“Barclays, DBS and Deutsche Bank all have coal policies which prevent underwriting coal bonds in some form. We believe those policies should be applied to this transaction because the Adani Group operates effectively as one single business – and that business’s primary goal is coal expansion,” said Nick Haines, Senior Campaign Manager at Ekō.

“Investing in any Adani company is like pouring money into a sieve – there’s no telling where it will go. By issuing this bond through Adani Green Energy Ltd, Adani is putting its best foot forward with global investors, but nothing has changed since Hindenburg raised the alarm on irregular transactions across the conglomerate.

“The dozens of related party transactions revealed in Adani Green Energy’s disclosures show that investors in this bond cannot be assured that their capital won’t help facilitate the Adani group’s vast coal expansion pipeline.

“We note banks we wrote to like BNP Paribas, Mizuho and Axis Bank – all previous bookrunners of Adani bonds – are not participating in this deal. This may be Adani’s first reentry to global capital markets since Hindenburg but we urge banks and investors to recognize that this bond is just the greenwashed tip of the spear. What lies behind it is a vast empire of coal,” he added.

Bookrunners on a previous Adani bond deal were tainted with allegations of securities fraud, after an SEC complaint was lodged for failing to disclose coal links within the Adani empire, forcing an embarrassing correction from second party opinion provider Vigeo Eiris.

In 2023, Hindenburg Research raised the alarm on suspicious related party financial transactions within the Adani Group. It was subsequently brought to light that Adani used shares from AGEL as collateral in a $300 million credit facility for the Carmichael coal mine in Australia. Deloitte sensationally resigned as auditor of Adani Ports and Special Economic Zone after giving a qualified opinion over concerns regarding suspicious related-party transactions. AGEL’s ‘23 financials also received only a qualified opinion from its auditors.

Norway’s largest pension fund last year sold out of its entire holding in AGEL over fears that its holding could be funding coal. The unprecedented and unresolved evidence of governance failures exposed by Hindenburg, and corroborated by independent agencies, should be reason enough for international banks to rule out this deal. However, Adani also has a documented history of corruption, bribery, environmental destruction, and human rights abuses across the world. At present, Indigenous Adivasi communities in India’s Chattisgarh are staging widespread protests against Adani’s coal mining blocks in Hasdeo Arand forest.