Adani Group moved closer to taking over TV channel NDTV after NDTV founders Prannoy Roy and his wife Radhika Roy resigned as directors of group promoters RRPR Holding Private Limited. Prannoy Roy and his wife Radhika Roy, however, still hold a 32.26 percent stake in NDTV as promoters and have not resigned from the news channel’s board.
How Adani Group Takes Over NDTV: A Brief Timeline
Much of the spotlight on Adani’s two-stage takeover bid has been on one, little-known Indian company: Vishvapradhan Commercial Private Limited (VCPL), founded in 2008.
Vishvapradhan Commercial Pvt Ltd has given loan ₹403.85 crore to NDTV’s promoter company RRPR Holding Pvt Ltd. Against this interest-free loan, RRPR issued guarantees of
VCPL, giving it the right to convert them into a 99.9 percent stake in RRPR in the event of default.
More than a decade ago, NDTV founders Radhika and Prannoy Roy took an interest-free loan of over ₹400 crore from a company that Adani Group acquired in August. RRPR, which was acquired by the Adani Group, held a 29.18 percent stake in the news channel.
The loan agreement requires Prannoy Roy and Radhika Roy, who together held 55.5 percent in NDTV at the end of June 2009, to transfer part of their stake to RRPR Holdings.
Due to these terms, RRPR Holdings’ stake in NDTV increased to 29.18 percent by January 2010. In 2012, Reliance sold VCPL to Nextwave Televenture Pvt Ltd and Skyblue Buildwell Pvt Ltd – companies associated with Mahendra Nahata, director at Reliance Jio Infocomm Ltd, a subsidiary of Reliance Industries Ltd. Ambani’s Jio bought Nahata group’s Infotel Broadband in 2010 to re-enter the telecom business.
The ownership of VCPL changed hands in 2012. The Adani group firm first acquired VCPL from its new owner and exercised an option to convert outstanding debt into a 29.18 percent stake in the news channel company. Then do a ₹493 crore open offer to buy an additional 26 percent stake from the public in compliance with the country’s takeover norms.
On August 23, the Adani group announced the acquisition of a 29.18% stake indirectly in NDTV through the acquisition of VCPL, which holds a 99.99% stake in RRPR Holding.
RRPR or Radhika Roy Prannoy Roy Holdings Private Limited is the promoter of NDTV. It held a 29.18% stake in the news channel. The conversion of warrants into equity due to default on the loan gave the Adani group almost all of the shares in RRPR Holdings.
Adani Group’s indirect control of a stake of more than 25% means it has to make an open offer to buy at least another 26% of NDTV’s existing shareholders to enable them to exit, according to Indian regulations.
Adani group firms Vishvapradhan Commercial Private Limited (VCPL) along with AMG Media Networks and Adani Enterprises Ltd then offered to acquire an additional 26 per cent or 1.67 crore shares through an open offer.
*With information from agencies
Watch all industry news, banking news and updates on Live Mint. Download The Mint News app to get daily market updates.
Even less