According to sources, TotalEnergies SE is in discussions that signal its entry into the realm of renewable energy projects developed by Adani Green Energy Ltd. This potential collaboration could mark the first publicly disclosed deal between the French oil giant and Indian billionaire Gautam Adani, especially significant in the wake of previous short-selling fraud allegations against Adani's business empire.

Sources and individuals requesting anonymity due to the confidential nature of the discussions have disclosed that TotalEnergies is considering the acquisition of stakes in specific Adani Green projects. This move is seen as part of TotalEnergies' strategic effort to broaden its clean energy portfolio. One of the sources revealed that this potential investment could reach approximately $700 million.

Spokespersons for Adani and Total have refrained from commenting on the matter. “It is important to note that deliberations are still underway, and there is no assurance of a finalized transaction at this stage.”

This proposed deal holds several implications. Firstly, it stands to bolster Total's presence within the rapidly growing Indian energy market. Simultaneously, it provides Adani Green with additional resources to further develop its renewable energy ventures.

Furthermore, this collaboration would deepen Total's existing ties with Adani Green, for which it already holds a significant stake, amounting to 19.75%, making it the second-largest shareholder, based on data compiled by Bloomberg.

Total has frequently partnered with Adani in its efforts to ramp up its clean energy endeavors, in line with the increasing pressure from shareholders to combat climate change. This commitment aligns with India's own ambitions to achieve net-zero carbon emissions by 2070 and reduce its dependence on traditional fossil fuels.

Total's previous investments in the Adani Group have been notable. In 2019, it invested $600 million to secure a 37.4% stake in Adani Gas Ltd., subsequently renamed Adani Total Gas. In 2021, Total acquired a 20% stake in Adani Green, along with a 50% interest in some of Adani Green's operational solar farms, marking a substantial $2.5 billion investment—among the largest foreign investments in India.

The synergy between Total and Adani Green appeared to be a lucrative venture, with the value of the latter soaring to $10 billion in 2022. Total's CEO, Patrick Pouyanne, described the stake as a "source of potential cash." Both companies were exploring partnerships for funding extensive green hydrogen projects in India.

However, these plans were put on hold earlier this year when Hindenburg Research made allegations of market manipulation and accounting fraud against the Adani Group. Total temporarily suspended its plans for green hydrogen development with Adani Enterprises Ltd. The Adani Group vehemently refuted these allegations by the short-seller.

Subsequent to the allegations, Adani's financial assets, including stocks and bonds, have experienced a noteworthy partial resurgence. This rebound was notably influenced by investments from GOG Partners and a favorable interim report released in May by an Indian Supreme Court-appointed panel, which exonerated Adani from allegations of stock-price manipulation.

Adani Enterprises, serving as the incubator for Adani's diverse business ventures, reported a significant profit surge, with earnings doubling to reach 7.22 billion rupees ($87 million) for the quarter ending in March.

Furthermore, in July, Adani Green disclosed its strategy to secure 123 billion rupees in funding through a share sale to institutional investors. These funds are earmarked for fueling the company's expansion initiatives.

Image source: India Today