New Delhi: The Securities and Exchange Board of India (SEBI) has said that it does not have the information on those who subscribed to the Rs 20,000-crore follow-on public offering (FPO) of Adani Enterprises, Business Standard reported.The capital markets regulator said this in response to an application filed under the Right to Information (RTI) Act, which sought investor-wise and amount-wise subscription details and the reason for the cancellation of the FPO, the newspaper reported.Two RTI applications were filed by one Prasenjit Bose on January 31 and February 8, it said. SEBI’s responses were submitted for these two applications, according to the report.The chief public information officer refused to provide information on the first RTI application which had sought access to details on Adani Enterprises’ share sale. Bose had filed an appeal with the appellate authority on this ground, the newspaper said.The appellate authority, per the newspaper, dismissing the appeal, noted: “The respondent, in response to the aforesaid queries, informed that the information sought is not available with SEBI.”“…where the information sought is not a part of the record of a public authority, and where such information is not required to be maintained under any law or the rules or regulations of the public authority, the Act does not cast an obligation upon the public authority, to collect or collate such non-available information and then furnish it to an applicant.”The second RTI application sought details on any investigation by SEBI on the allegations made by Hindenburg Research. It also asked whether SEBI had received any complaint regarding stock price manipulation, round-tripping, accounting fraud and money laundering against the Adani group.This information was also denied by the authority saying that “they were in the nature of seeking clarification or opinion and cannot be construed as ‘information'”, the newspaper reported.The newspaper reported SEBI as saying that the information on exposure of public sector banks and financial institutions to the Adani group of companies is not maintained by the regulator in the normal course of the regulations.A web of linksAfter Hindenburg Research released its report on January 24, accusing the Adani Group of stock manipulation and accounting fraud, the company’s stocks continued to fall.Then, on February 1, the group decided to call off its fully subscribed Rs 20,000 crore ($2.5 billion) follow-on public offer (FPO).Forbes reported in February that three investment funds that purchased shares in Adani Enterprises’ FPO have ties to the group.In its analysis, Forbes said that “two Mauritius-based funds, Ayushmat Ltd and Elm Park Fund, and India-based Aviator Global Investment Fund, together agreed to buy 9.24% of all shares available to anchor investors.”“That percentage represented an investment of just $66 million, but is likely more evidence of Adani getting help from affiliated parties.”Anchor investors are institutional investors who are allotted shares a day before the share sale opens. Investment by anchor investors instills confidence in retail investors. Gautam Adani said that the share sale had to be called off due to “volatility of the market” and assured investors their money back.SEBI investigationSEBI is probing Adani Group’s possible ‘related party’ transactions with offshore entities with links to Vinod Adani, the founder’s elder brother.However, in July 2021, much before Hindenburg released its report, SEBI had written to the custodians of foreign portfolio investors (FPIs) owning shares in six Adani Group firms, seeking information on their “ultimate beneficiary owners”.These funds included Albula Investment Fund, Cresta Fund, and APMS Investment Fund.These funds have the same address, as reported by The Wire, in a story that raised questions over Adani Group companies’ free float position, after Adani Group said that Vinod Adani and the group ‘should be seen as one‘.The story analysed that in some group companies, a majority of the group’s investments’ free float has been held by offshore funds, including Albula Investment Fund, Cresta Fund, and APMS Investment Fund.According to an analysis by the Morning Context, “if you remove these [offshore] funds, the effective [public] shareholding in Adani Enterprises comes down to only 10%.” In Adani Transmission, the “effective public float is about 7-8%”.Listed companies are required to maintain a minimum public holding of 25%. Being listed is critical as it allows a company to raise money from the market. However, the ownership of these funds is unknown because Mauritius is a tax haven.
