On October 17, Adani Group will begin its open offer to buy an additional 26% stake in NDTV.
According to an advertisement by JM Financial, the offer’s manager, the open offer to purchase 1.67 crore equity shares will probably end on November 1. A price of ₹294 per share has been set for the offer.
The open offer will cost ₹492.81 crore rupees if it is fully subscribed at a price of ₹294 per share.
On August 23, it was announced by the Adani group that it would buy VCPL, which owns a 99.99% stake in RRPR Holding, in order to acquire a 29.18% stake in NDTV.
AMG Media Networks, Adani Enterprises Ltd., Vishvapradhan Commercial Private Limited (VCPL), and other Adani group companies then proposed to buy an additional 26%, or 1.67 crore equity shares.
Days after this announcement, NDTV’s founder and promoters argued that the deal requires approval from Sebi in order to proceed.
The Securities and Exchange Board of India (Sebi) banned NDTV founders Radhika Roy and Prannoy Roy from the securities market for two years in an order that was issued on November 27, 2020. The two-year ban expires on November 26.
According to the founders of NDTV, Vishvapradhan Commercial Private Limited (VCPL) needed prior written approval from Sebi in order to exercise the conversion option on the warrants because restrictions were still in place.
To get clarification on the applicability of the regulator’s earlier order regarding the conversion of warrants into shares, which has become a deciding factor in the hostile takeover battle for the media group, RRPR Holding Ltd. and the Adani group have approached Sebi.
Adani Group has already denied the claims made by NDTV, claiming that the promoter entity RRPR Holding is not covered by the regulator’s order preventing Prannoy and Radhika Roy from accessing the securities market.
Terming the contentions raised by RRPR Holdings as “baseless, legally untenable and devoid of merit”, VCPL had said the holding firm is “bound to immediately perform its obligation and allot the equity shares” as specified in the Warrant Exercise Notice.
The restraints do not apply to RRPR because it is not a party to the Sebi Order dated November 27, 2020, according to VCPL.
It also stated that RRPR is bound by the contract by which its subsidiary VCPL issued the Warrant Exercise Notice.
On August 23, the Adani group made the announcement that it would begin an open offer to purchase a further 26% of the company. This company runs three national news channels: NDTV Profit, NDTV India, and English News Channel NDTV 24×7.
The main driving force behind the takeover attempt is an unpaid loan that NDTV’s promoter company, RRPR Holding Pvt Ltd, received from VCPL.
In 2009–2010, NDTV took out a loan for ₹403.85 crores, and RRPR issued warrants in exchange for this sum. In the event that the loan was not repaid, VCPL had the option to convert the warrants into a 99.9% stake in RRPR.
After first purchasing VCPL from its new owner, Adani group exercised the option to convert outstanding debt into a 29.18 percent stake in the news channel company.
The NDTV promoters had asserted that the takeover had occurred without their knowledge or consent up until Tuesday.