After the US charged Adani, Kenya backed out of deals worth more than $2.5 billion

Thursday, Kenyan President William Ruto said that he had stopped a process that was supposed to give India’s Adani Group control of the country’s main airport after the head of that group was charged in the US.

The Adani Group was going to get a 30-year lease in return for adding a second runway and improving the passenger terminal at Jomo Kenyatta International Airport. The deal was worth almost $2 billion.

Ruto also said he was canceling a separate deal that the energy ministry and an Adani Group company signed last month to build power transfer lines. The deal was for 30 years and $736 million.

In his state of the nation address, Ruto said, “I have told agencies within the ministry of transport and within the ministry of energy and petroleum to immediately cancel the ongoing procurement.” He said this because of “new information provided by investigative agencies and partner nations.”

The lawmakers in parliament, where Ruto gave his speech, greeted his news with loud cheers and clapping. A lot of leaders and regular people don’t like the deals because they think they aren’t clear or give good value for money.

Adani Group representatives did not reply right away to a request for comment.

In a Wednesday indictment, U.S. authorities said that Gautam Adani, the founder of the group and one of the richest people in the world, and seven other defendants planned to pay Indian government officials about $265 million in bribes.

It was said that the Adani Group would take “all possible legal recourse” to fight the claims.

The airport plan was made by the Adani Group in March using a method that skips open bidding. However, it wasn’t made public until July when it was leaked on social media.

In September, a lawsuit said it did not give taxpayers good value for money, so a Kenyan court briefly blocked it.

Senior government officials, including Ruto, had repeatedly defended the deals, even though U.S. short-seller Hindenburg Research said in 2023 that the Adani Group was not following good governance standards. The Adani Group denied the claims.

Energy Minister Opiyo Wandayi told senators as late as Thursday morning that he thought the transmission lines deal would go through because it wasn’t given out through bribery or corruption.

George Kamau, a Kenyan lawyer who specializes in public procurement, said that the Adani Group might fight the cancellations in arbitration, especially the deal for the transmission lines that had already been signed.

“That said, any dispute resolution framework … is likely to lean towards the state, considering the fact that the deal has been cancelled on the basis of integrity issues,” said he.