NDTV promoter group transfers 99.5% shares to Adani firm; stock jumps

RRPR Holding, the promoter entity of New Delhi Television Ltd (NDTV), has transferred 99.5% of its equity share capital to Vishvapradhan Commercial Pvt. Ltd. (VCPL), which is owned by AMG Media Network Ltd. (AMNL), the media arm of the Adani group.

Reacting to the news, shares of NDTV rose 5% to ₹426.40 apiece on the BSE.

This comes months after RRPR Holding wrote a letter to capital markets regulator Securities and Exchange Board of India (SEBI), asking it to determine whether its previous order banning the news network's promoters from dealing in the securities markets for two years restricts conversion of warrants issued to VCPL into equity shares.

SEBI in its order dated November 27, 2020 had restrained the NDTV founders from buying, selling or otherwise dealing in securities, directly or indirectly, for a period of two years until November 26, 2022.

In a stock exchange filing on Monday, NDTV said that SEBI has not responded to its specific letter dated August 28, 2022, on behalf the promoter group vehicle seeking clarification, but has since approved the letter of offer by VCPL along with AMG Media Networks and Adani Enterprises for acquiring up to 16,762,530 fully paid up equity shares of the face value of ₹4 each representing 26% of the voting share capital of the media network.

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

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. However, the Gautam Adani-led conglomerate missed the open offer launch date on October 17.

The Adani group had earlier said the warrant exercise notice has been issued by VCPL under a contract which is binding on RRPR. “RRPR is therefore obligated to comply with its contractual obligations,” the ports-to-power conglomerate said.

In September, the Adani group said that the Income Tax Department's provisional attachment of equity shares of NDTV held by RRPR Holding does not need any prior approval for exercise of warrants. The income tax orders only apply to the shares of NDTV held by RRPR and in no manner restrict RRPR from completing the formalities in relation to allotment of equity shares to VCPL on exercise of the warrants, the company had said.