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Responding to a notice by the Petroleum and Natural Gas Regulatory Board (PNGRB) seeking explanation for not disclosing the scheme of arrangement between Adani Gas Ltd (AGL) and Adani Enterprises Ltd (AEL), an AGL spokesperson has said that it has not hidden any information regarding the structural reorganisation
“All authorities concerned were intimated about the proceedings pertaining the reorganisation of AGL through media/newspapers/disclosures/public listing/bid submissions. We have duly responded to the PNGRB with all required information to close the matter,” the spokesperson said in a statement.
It is said that AGL banked on the strength of Adani Enterprises when bidding for City Gas Distribution (CGD) projects. Subsequently, AGL was hived out of AEL into a separate entity.
“Our project work at all Geographical Areas (GAs) is going on in full swing and with the facilitation and support of PNGRB and all authorities, we are committed to delivering compressed natural gas and piped gas to millions of our consumers on a fast-track basis,” the spokesperson added.
Initial reports on the notice said that AGL is also facing a ₹400 crore penalty and a possible cancellation of CGD licences if it is found to be in violation of the norms.
Shares of the company fell on the news from ₹173.10 a scrip to ₹160.85 a scrip on the BSE but recovered during trade on Friday. The shares closed at ₹176.60 a scrip, 2.17 per cent higher.
“There is no question of penalties as same are not applicable, and moreover, Adani Gas is in full compliance of applicable rules/laws,” the spokesperson said.
‘No further questions’
“The PNGRB has not levied or even indicated anything. Further, after our explanation, the regulator has not questioned us again,” a company source told BusinessLine .
According to people in the know, the notice was issued by the PNGRB in the third quarter of the financial year 2019-2020, shortly after it was announced that French oil and gas giant Total SA will acquire a 37.4 per cent stake in AGL for ₹6,155 crore.
AGL had submitted its response in the second week of December 2019 and submitted the opinion of a retired justice explaining that there is no change in the authorised entity post the scheme, and there is no violation of any regulatory provisions.
According to the deal announced on October last year, Total will purchase 37.4 per cent stake in Adani Gas through a tender offer to public shareholders to acquire up to 25.2 per cent shares at ₹149.63 per share, subject to applicable regulations, and purchase the residual shares from the Adani family.
The Adani family and Total SA shareholders will ultimately hold 37.4 per cent each and the public shareholders the remaining 25.2 per cent.
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