Lawyer Accuses American Businessman of Commissioning Hindenburg Report on Adani Group

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Senior lawyer Mahesh Jethmalani has alleged that a businessman with Chinese links had commissioned a report by short-seller Hindenburg Research, leading to a hit on Adani Group shares. According to Mr. Jethamalani, Mark Kingdon, the American businessman behind Kingdon Capital Management LLC, hired Hindenburg to prepare a report on the Adani Group. As per the lawyer, Kingdon also approached Kotak Mahindra Investments Limited (KMIL) to set up an offshore fund and offshore accounts to trade in Adani shares, resulting in the creation of the Kotak India Opportunity Fund (KIOF). This fund allegedly took short positions in Adani Group companies through the Mauritius route before the Hindenburg report was made public, with nearly $40 million provided by the Kingdon Master Fund.

The ‘smoking gun’ in the case, as pointed out by Jethmalani, was the revelation that Mark Kingdon’s wife, Anla Cheng, who has a significant shareholding in the Kingdon Master Fund, is a lobbyist for Chinese interests in the United States. The lawyer highlighted Cheng’s involvement in a pro-China media initiative and subsequent ties to the Chinese Communist Party. It was suggested that the actions of Cheng and Kingdon were influenced by the Adani Group’s interference with Chinese interests on a global scale, including outbidding Chinese players for projects like the Haifa Port in Israel and coal ventures near Sri Lanka’s Jaffna.

Mr. Jethmalani posed critical questions regarding the introduction of the Kingdons to KMIL, the due diligence conducted by KMIL, and their involvement in the short sell. He also raised concerns about Indian entities, including politicians, and their knowledge of the short-selling plan, as well as whether they were aware of the Chinese link. The lawyer’s accusations come as SEBI issued a show cause notice to Hindenburg Research LLC for misrepresentations in their report on Adani Group, which caused panic in share prices. Hindenburg denied providing Kingdon with research before the report’s publication and emphasized their transparency in disclosing their short position.