Australia: Pension Fund Seeks Information on Investing in Adani Enterprises

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An Australian pension fund client of GQG Partners has asked the U.S. boutique investment firm for more information about its nearly $1.9 billion investment in the embattled Indian Adani group

The move comes as public pressure mounts on Adani over its plans to build a massive coal mine in Australia’s Queensland state.

In a significant vote of confidence, GQG Partners purchased $1.87 billion worth of shares in four Adani group companies, the first noteworthy investment since a negative report from a short-seller caused stock prices to plummet.

Currently, a U.S. firm oversees investments for at least four primary Australian pension funds that amount to A$563 billion in total assets under management. If GQG invests with Adani now – when Norway’s sovereign wealth fund and other significant investors pull back from their stocks – these pension funds could be exposed to high risks.

Boasting a phenomenal A$71 billion in assets, Cbus Super has appointed GQG Partners to manage their emerging markets portfolio of A$243 million. According to the spokesperson, the fund is investigating ways they could be exposed through Adani investments and actively striving for increased clarity on this issue.

Adani entities had not been part of the portfolio, but we are currently engaging with the external manager who has recently made acquisitions in this area,” they said.

In a statement, GQG Partners Australia and New Zealand managing director Laird Abernethy expressed that the fund manager had reached out to all their institutional investors so they could understand why they needed to make this purchase.

The agreement between AustralianSuper and GQG Partners will result in the latter’s exposure to Adani Group companies, an insider source has revealed.

Upon thoroughly assessing its most recent holdings, the $258 billion fund needed more investments in Adani Group companies as of June 2022.

The Rest Super, a pension fund worth an enormous A$67 billion, confirmed knowledge of the transaction and noted that it had not affected their portfolio yet. Interestingly enough, shares of GQG Partners suffered a 3 per cent drop once news of the investment became public, while other stocks on the bourse just increased by 0.4 per cent.

Doubt and uncertainty are prevalent when it comes to recognizing the level of risk taken on by stakeholders..” Jun Bei Liu, the Tribeca Alpha Plus Fund manager, exclaimed.

On January 24th, Hindenburg Research accused the Adani Group of illicit stock manipulation and the Adani family-owned usage of hidden offshore tax havens that allegedly hid how much stock. Their seven listed firms have seen an estimated $130 billion evaporate in value since then. The Indian conglomerate denied any wrongdoings.

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