Six out of the eight public funds utilized by the individuals connected to the Adani Group for purchasing the shares in the publicly listed conglomerate firms have been closed. These funds are based in Bermuda and Mauritius. The shutdown of these funds represents the difficulty of the Securities and Exchange Board of India (SEBI) in identifying the ultimate beneficiaries of these entities. The closure of most of these funds matches with the commencement of a Securities and Exchange Board of India (SEBI) investigation in 2020, Mint reported on Wednesday.
These developments indicated that the Securities and Exchange Board of India (SEBI) initiated an investigation earlier into the recently closed Adani Groups; it might have facilitated the regulators in evaluating their potential involvement in influencing the stock prices of Adani Group. However, the closure of these funds has made it more challenging for SEBI to obtain information about the ultimate beneficiaries of these entities, as mentioned in the report.
As per the recent report by the Organized Crime and Corruption Reporting Project (OCCRP), individuals in relation to the Adani family supposedly employed these funds to maintain the substantial ownership of the stakes in the company, possibly violating the regulations concerning maximum ownership limits in the country.
A fund can be closed for various reasons like bankruptcy, acquisition with the transfer of assets by a new owner, or a decision made by the investors to terminate it. It is worth noting that some of these funds had relatively smaller lifespans, which is not common for funds of this nature. For instance, the Bermuda-registered Global Opportunities Fund, established on January 6, 2005, was closed down on December 12, 2006.
Mint reported, Assent Trade and Investment Pvt. Ltd in Mauritius was established in April 2010 and became inactive in June 2019. Lingo Trading & Investment Pvt Ltd, founded in December 2009, stopped their operations in March 2015. Mid East Ocean Trade & Investment Pvt. Ltd was established in September 2011 and was closed in August of the previous year. The EM Resurgent Fund was established in May 2010 and the operations ceased in February 2022. Similarly, the Asia Vision Fund, founded in May 2010, appointed liquidators in April 2020 and is currently undergoing the winding-up process.
