On Thursday, billionaire U.S. investor Bill Ackman publicly expressed his support for the recent report released by short-seller Hindenburg Research on India’s Adani Group. Ackman stated that he found the report to be “highly credible and extremely well researched.”
The report, which was released on Wednesday, accused the Adani Group of improper use of offshore tax havens. As a result of the report, shares in seven listed group companies of Adani experienced a significant drop in market capitalization, losing a total of $10.73 billion in India.
In response to the report, Hindenburg Research has announced that it holds short positions in Adani Group through its U.S.-traded bonds and non-Indian-traded derivative instruments. The Adani Group has stated that it is currently evaluating potential “remedial and punitive action” against Hindenburg, and has deemed the report to be “maliciously mischievous (and) unresearched.”
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Hindenburg Research has also stated that if the Adani Group chooses to file a lawsuit in the United States, it will demand documents in the legal discovery process.
Ackman, who is the CEO of Pershing Square, has previous experience with short selling, having bet $1 billion against Herbalife starting in 2012. He argued that the company violated Chinese direct-selling laws and was operating as a pyramid scheme. However, he exited his short position in Herbalife at a loss in 2018, as the shares of the company experienced a significant increase of more than 150%.
It is important to note that Ackman has stated that he is not currently invested, long or short, in any of the Adani companies or Herbalife, nor has he conducted independent research on the matter.