Gautam Adani-led Adani Group on August 23, 2022 acquired 29.18 per cent stake in the television channel NDTV Ltd, stating that it would launch an open offer as required by the Securities and Exchange Board of India (SEBI) to buy another 26 per cent in the company.
NDTV; HOW THIS HAPPENED?
Adani Enterprises Ltd’s subsidiary AMG Media Networks Ltd bought Vishvapradhan Commercial Pvt Ltd (VCPL), which had in 2009 and 2010 given Rs 403.85 crore as loan to NDTV promoter company RRPR Holding Pvt Ltd, owned by Radhika Roy and Prannoy Roy.
Against this interest-free loan, RRPR issued warrants to VCPL entitling it to convert them into a 99.9 per cent stake in RRPR. The RRPR Holding Pvt Ltd holds 29.18 per cent stake in NDTV, which has the Adani group now acquired.
NDTV; CAN ADANI HOLD CONTROL?
Roys hold more share than the Adani Group in NDTV. However, market experts said the business conglomerate holds an edge. As of June 2022, Drolia Agencies owns 1.48 per cent stake, GRD Securities 2.8 per cent, Adesh Broking 1.5 per cent and Confirm Realbuild 1.33 per cent. LTS Investment Fund which owns 9.75 per cent in NDTV, also owns shares in Adani Enterprises. If these investors sell their shares in the open offer, it would take Adani Group’s shareholding in NDTV to over 46 per cent.
NDTV in a notice to the stock exchanges said that the acquisition was executed without any discussion or consent of NDTV founders Prannoy Roy and Radhika Roy. The Roys continue to hold 32.26 per cent stake in NDTV.
NDTV Ltd also cited a SEBI order of November 27, 2020. In its disclosure to the stock exchanges, NDTV has said that this order restrained the founder-promoters Prannoy Roy and Radhika Roy from accessing the securities market, and prohibited them from buying and selling securities, directly or indirectly for two years. This two-year period ends on November 26, 2022.
Moreover, SEBI order may not present a hurdle as the present transaction does not entail a fresh sale or purchase of securities. It only involves an execution of an arrangement that VCPL and RRPR had entered into back in 2009 and 2010.