NDTV promoters, Radhika Roy and Prannoy Roy, have written to the Security and Exchange Board of India asking whether SEBI’s previous order in 2020, withholds company RRPR Holdings (RRPRH) from transferring NDTV shares to Adani. 

This letter is a part of a series of back and forth communication between NDTV promoters and Adani, wherein the veteran journalists are seeking to prevent transfer of 29.18 per cent stake of the news company to Adani. 

Conversion of warrants

In a stock exchange filing the promoters disclosed—“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, ending on 26 November 2022.”

Therefore, the promoters are seeking clarification regarding whether this SEBI order, restricts conversion of warrants issued to Vishvapradhan Commercial (“VCPL”) into equity shares of the promoter group RRPRH.

VCPL had issued a notice to RRPRH, (NDTV promoter’s holding company holding 29.18 NDTV stake) on August 23 intimating that – “it (VCPL) was exercising its right to convert warrants issued to it in 2009 into equity shares which would give VCPL the control of 99.5 per cent of RRPRH.”

The conglomerate had acquired VCPL through Adani Enterprises’ subsidiary AMG Media Networks for ₹113.75 crore.

If VCPL is able to conclude these proceedings, Adani will gain 29.18 per cent stake in NDTV. In fact, after acquiring VCPL, Adani group had launched an open offer to acquire 26 per cent stake in NDTV at ₹294 a share. The open offer proceedings will commence once the RRPRH shares are granted to Adani.

Easy chance for Adani

Experts note that there is a good chance that Adani will have direct or indirect control over 50 per cent of NDTV stake. This will mean that Adani will have unbridled control over the company’s operations and would be easily able to outvote founder promoters, Prannoy Roy and Radhika Roy. 

Thus the promoters are exercising every means to stall the transfer of shares to Adani. According to promoters, Adani needs a SEBI nod before the NDTV stake is transferred to the company. NDTV has also postponed its AGM to 27 September in the current situation. 

Meanwhile, NDTV shares sustained the momentum. On Monday also, the NDTV stock closed 5 per cent higher at ₹445 on the BSE.