SEBI investigates Adani Group’s ties with Gulf Asia Fund

In order to determine whether share ownership regulations have been broken, India's market regulator is looking into the connection between the Adani Group and a fund established in the British Virgin Islands.

The fund is known as Gulf Asia Trade & Investment, and according to the Organised Crime and Corruption Reporting Project (OCCRP), it has invested in a number of listed Adani companies.

The investigation is a component of the Securities and Exchange Board of India's (SEBI) inquiry into the Indian conglomerate and comes in response to a report from short-seller Hindenburg Research from January, which claimed that offshore shell corporations "surreptitiously" owned stock in Adani listed companies, raising governance issues.

A key question for SEBI investigators is whether Gulf Asia's ties with the Adani Group were such that it would be deemed to be acting "in concert" with key Adani shareholder. 

The conglomerate has previously said it categorically rejects allegations by OCCRP that there was an "opaque use" of funds by business partners to invest in its listed companies. It has also denied allegations made by Hindenburg, saying all transactions made with entities that qualified as related parties had been fully disclosed.