Adani’s London connection under scrutiny as UK watchdog launches probe: Report

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Elara Capital, a London-based company, has been reported to have connections to the Adani Group, and the Indian conglomerate itself is being watched by the Financial Conduct Authority (FCA) in the UK.

Although the allegations mainly focus on group companies outside the UK, the FCA is investigating possible UK connections around Elara, according to sources familiar with the situation who spoke to Financial News.

As former UK Prime Minister Boris Johnson’s brother Jo steps down from his board at the company, Elara is being investigated by the FCA. On February 1, Jo Johnson announced his resignation as Adani’s stock plummeted.

The person with knowledge of the FCA’s reasoning said the sale of Adani Enterprises concerned securities of a publicly traded Indian company. Livemint was unable to independently verify the developments.

Raj Bhatt, the CEO and Director of Elara, founded the company in 2002 with the primary goal of raising funds for Indian companies. Additional Elara Capital locations include Singapore, Mauritius, New York, Ahmedabad and Mumbai. On its website, it lists asset management, sales and trading, research and analysis, and investment banking as some of its services.

After the loss, Adani Enterprises canceled a $2 billion Follow-Up Public Offering (FPO) and retaliated against Hindenburg’s claims in an effort to stop its price slide. The same day that the Adani Group announced the cancellation of the FPO, Johnson announced his resignation from the company.

“I now recognize that this is a role that requires greater expertise in specialized areas of financial regulation than I anticipated, and I have resigned from the board accordingly,” Johnson said.

Since the January 24 report, Adani’s market value has decreased by more than $100 billion. Adani has refuted all charges.

Elara was mentioned by US-based Hindenburg Research in a study that raised questions about the financial stability of the Adani Group. The Indian company has refuted the short seller’s financial fraud charges on Adani, but they have caused a drop in stocks across all Adani entities.

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