October 4, 2023

Adani Group Taps Wachtell as Legal Muscle to Battle Hindenburg: Report

Adani Group Taps Wachtell as Legal Muscle to Battle Hindenburg

The news arrives as Gautam Adani, a billionaire entrepreneur, continues to emphasize to investors the solid footing of his business empire and the absence of any financial vulnerabilities. Here is how and why Adani Group Taps Wachtell as Legal Muscle to Battle Hindenburg.

According to The Financial Times, the Adani Group has engaged one of Wall Street’s most prominent legal defense firms to confront US short-seller Hindenburg Research, who has accused the Indian conglomerate of stock manipulation and accounting fraud.

Meanwhile, billionaire Gautam Adani is steadfast in assuring investors of the stability and security of his business empire, emphasizing that there are no financial hazards present.

According to a report from the Financial Times, sources familiar with the situation have stated that the Adani Group has sought the assistance of top lawyers at New York’s Wachtell, Lipton, Rosen & Katz to handle the current challenges facing due to the accusations made by Hindenburg Research. These accusations have had a significant negative impact on the Adani Group’s market capitalization and investor confidence.

The decision to retain the services of Wachtell, one of the most expensive law firms in the US, underscores the gravity of the situation the Adani Group is facing in the wake of the Hindenburg report. The company is also under significant pressure from various global financial institutions in light of the allegations made against it.

Also Read: Adani Enterprise Share Soars Following 413-Page Rebuttal of Hindenburg Research Report

For many years, Wachtell has earned a reputation as the preferred legal counsel for some of the largest corporations in the US, when they are targeted by activist investors or facing hostile takeovers. 

Despite the Adani Group’s denial of the accusations made by Hindenburg Research and its release of a 413-page counterargument, this has had little to no effect on investors and financial institutions globally.

The vast Adani Group, which includes seven main publicly-listed companies and three other entities acquired in recent years, has seen a significant decline in the value of its stocks after the publication of the Hindenburg report. 

The conglomerate was forced to cancel its follow-on public offering (FPO) for its flagship company, Adani Enterprises. The report has resulted in a decline of over $110 billion in the market capitalization of key Adani Group companies.

The Adani Group has taken the step of retaining the services of a US law firm as part of their strategy to defend themselves against Hindenburg and to demonstrate to international financial institutions and investors that the company is in a strong position. In an effort to improve market sentiment, the Adani Group’s leadership recently prepaid loans worth $1.1 billion and has plans to pay off an additional $500 million to foreign banks ahead of schedule.

According to a report by the Financial Times, the Adani Group sought the assistance of the prestigious law firm, Wachtell, through their legal representation at Cyril Amarchand Mangaldas. Wachtell is reportedly seeking additional support for the Adani Group, including from crisis communications firms. The main focus of the US law firm will be to provide coordinated legal, regulatory, and public relations support for the group.

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