Billionaire Adani’s Unit Considers Scrapping Myanmar Deal After Coup
Billionaire Gautam S. Adani attends a luncheon hosted by Japanese business groups at the headquarters of the business lobby Keidanren in Tokyo. (Photographer: Tomohiro Ohsumi/Bloomberg)

Billionaire Adani’s Unit Considers Scrapping Myanmar Deal After Coup

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Billionaire Gautam Adani-controlled Adani Ports and Special Economic Zone Ltd. is considering abandoning a plan to set up a container terminal at Yangon in Myanmar and write down the investment after a military coup in that country.

“In a scenario wherein Myanmar is classified as a sanctioned country under OFAC, or if OFAC opines that the project violates the current sanctions, Adani Ports plans to abandon the project and write down the investment,” the port company said in an investor presentation on Tuesday, referring to the U.S. Department of the Treasury’s Office of Foreign Assets Control.

OFAC administers and enforces economic and trade sanctions based on U.S. foreign policy and national security goals.

Touted a decade ago as one of Asia’s most promising frontier markets, Myanmar has seen many investors shun the country as a violent crackdown leaves more than 750 protesters dead and thousands of others locked up. Telenor ASA, Norway’s biggest telecom company announced on Tuesday it is writing down its 6.5 billion kroner ($780 million) investment in the country.

S&P Dow Jones Indices last month said it will remove Adani Ports from the Dow Jones Sustainability Indexes because of links to Myanmar’s military, which is alleged to have committed serious human rights abuses under international law.

In May 2019, Adani Ports announced its intent to set up a container terminal at Yangon through a lease agreement with the democratically-elected government of Myanmar. The project entailed a total investment of $127 million, including $90 million as upfront payment for the leased land.

The recent violence in Myanmar and the military coup have resulted in uncertainty, the port company said in the presentation. “The write down will not materially impact Adani Ports as it is equivalent to about 1.3% of total assets,” it said.

The project provides, directly or through sub-contractors, employment to about 300-350 people.

The investment write off in Myanmar will come at a time when Gautam Adani’s wealth has ballooned at the second-fastest pace among the world’s billionaires year-to-date.

©2021 Bloomberg L.P.

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