France's TotalEnergies on Friday said its exposure to India's Adani Group is limited to $3.1 billion, representing about 2.4 per cent of the company's capital employed.
“TotalEnergies has not performed any re-evaluation in its accounts of its stakes in the listed entities ATGL [Adani Total Gas] and AGEL [Adani Green Energy] in relation to the increase in their stock values,” the company said in a statement.
TotalEnergies' investments in Adani Group companies were undertaken in “full compliance” with Indian laws and the company's own internal governance policy, it said.
“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.”
TotalEnergies also said it “welcomed” an announcement by Adani to hire one of the 'big four' accounting firms to carry out a general audit.
Adani Group, a port-to-energy business, has suffered massive losses after last week’s report by US short-seller Hindenburg Research that accused the conglomerate of alleged financial fraud.
Hindenburg, which specialises in activist short-selling, made wide-ranging allegations of purported corporate malpractice, “brazen” market manipulation and accounting fraud after a two-year investigation into billionaire Gautam Adani's business empire.
The report triggered a sell-off across listed Adani companies, wiping out more than $118 billion of their market value.
TotalEnergies holds a 50 per cent stake in Adani Total Private and a 37.4 per cent stake in Adani Total Gas, which develops distribution networks to supply piped natural gas.
The European energy major also picked up a 20 per cent stake in Adani Green Energy in 2021. Before that, TotalEnergies formed a 50-50 joint venture with the renewable energy company in 2020 to operate solar projects.
Shares in Adani companies plummeted on Thursday after the Indian conglomerate called off a 200 billion rupee ($2.43 billion) share sale, citing “volatile market conditions.”