After missing deadline, Adani group says committed to NDTV open offer

After missing the open offer launch date on October 17, billionaire Gautam Adani-led Adani group has said it's committed to sealing the deal to buy an extra 26% stake in New Delhi-based media company New Delhi Television Ltd (NDTV). The Adani group, which recently acquired a 29.18% stake in NDTV, has said market regulator SEBI (Securities and Exchange Board of India) is yet to share its opinions on the draft open offer letter of the Adani group.

The group says while the underlying transaction has not been consummated due to the stance taken by NDTV founder’s holding company RRPR, the wholly owned subsidiary of Adani group AMG Media Networks is "committed to its vision and intends to proceed with the open offer in accordance with the provisions of the SEBI”. The SEBI provisions require that the open offer be completed regardless of whether the underlying transaction has been consummated. The group said VCPL re-affirms its commitment to complete the open offer process, and that SEBI has been requested to provide its observations on the draft offer letter filed in relation to the open offer.

VCPL had lent around ₹400 crore to NDTV founders Prannoy Roy and Radhika Roy in 2009-10, and thus owned warrants of their company RRPR Holding Private Ltd, which in turn owned 29.18% of NDTV.

As per the deal, VCPL had the right to exercise, at any time, further warrants to acquire up to 99.99% of the equity share capital of RRPR, and a purchase option to buy all existing equity shares of RRPR held by NDTV founders.

In August, VCPL exercised its right to convert those 19.9 lakh warrants into equity shares, constituting 99.50% of RRPR’s equity share capital. Following this, the Adani group said the acquisition will be followed by an open offer by VCPL to buy another 26% stake from minority shareholders of the media company.

NDTV responded saying the Adani group acquired the news network without any discussion with the company or its founder-promoters. Notably, Radhika and Prannoy Roy, through their company RRPR Holding, hold 61.45% of the total paid-up share capital of NDTV. NDTV, which operates three national news channels namely NDTV 24x7, NDTV India and NDTV Profit, recorded revenue of ₹421 crore, with an EBITDA of ₹123 crore and net profit of ₹85 crore in FY22.

The Adani group reiterated that the decision to acquire NDTV was taken in light of the Adani group’s objective to set up a credible nextgen media platform with an emphasis on digital and broadcast segments, and that "NDTV is a suitable broadcast and digital platform to deliver on this vision".

The Adani Enterprises Ltd stock is currently trading at 0.58% or 18 points down at ₹3,259. The stock opened a gap-down at ₹3,259 as compared to the previous session close of ₹3,277, in line with BSE benchmark Sensex, which is down 0.33% at 58,908.39 currently. The NDTV stock is also down at 1.62% or 5.4 points at ₹327.5. The stock has fallen 25.73% in the past month.