Adani Group secures NDTV as Roys announce exit


Radhika and Prannoy Roy, the founders of New Delhi Television Ltd (NDTV), agreed to sell 27.26% of the company to Adani Group despite initially opposing the takeover, giving the ports-to-power conglomerate majority control of the news broadcaster.

The departure of the Roys marks a significant turning point for the broadcaster that played a pivotal role in the growth of news television in India. The proposed deal will make Adani Group the majority shareholder of NDTV, with a 64.71% stake. The Roys will continue to own 5% of NDTV.

Changing hands

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Changing hands

The sale will take place on or after 30 December. The company didn’t disclose the price at which the shares would be transferred.

At the volume-weighted average market price of NDTV ( 368.43) over the past 60 trading days, Adani Group will need to pay approximately 648 crore for the additional stake in the company.

“We started NDTV in 1988 in the belief that journalism in India was world-class but needed a strong and effective broadcast platform that would allow it to grow and shine. After 34 years, we believe that NDTV is an institution that has met so many of our hopes and ideals; we are so proud and grateful that across the globe, NDTV is recognised as India’s and Asia’s Most-Trusted News Broadcaster,” the Roys said in a statement.

The NDTV board appointed Adani Group nominees Sanjay Pugalia and Senthil Chengalvarayan as directors with effect from 23 December.

The Roys will transfer their shares to RRPR Holding Pvt. Ltd, a promoter group firm acquired by Adani Group’s AMG Media Network in August through the conversion of warrants.

Following the acquisition, Adani Group announced an open offer to buy an additional 26% stake in NDTV in accordance with the market regulator’s takeover regulations and increased its holding to 37.45%.

“The AMG Media Network, after the recent open offer, is now the single-largest shareholder in NDTV. Consequently, with mutual agreement, we have decided to divest most of our shares in NDTV to the AMG Media network,” Roys said.

They added that since the open offer was launched, their discussions with Gautam Adani have been “constructive”, and all the suggestions they made were “accepted by him positively and with openness”.

“Mr. Adani has invested in a brand that is synonymous with trust, credibility and independence, and we are hopeful that he will preserve these values and expand upon them with all the responsibility required of a leader of an organisation of this nature. We look forward to watching NDTV, and its entire extraordinary team, delivering the next phase of growth, one that India can be proud of,” Roys said.

The sale will also end months of a tussle between the NDTV founders and Adani Group, which had acquired Vishvapradhan Commercial, a company that extended a loan of 403.85 crore to RRPR Holding in 2009-10 in lieu of warrants convertible into a 99.9% stake in RRPR Holding if the loan was not repaid.

Adani Group used the warrants to acquire the stake in NDTV. However, on the same day, the Roys said in a statement that the exercise of rights by Vishvapradhan Commercial was done “without their consent” or “any consultations” with them.

“It was executed without any input from, conversation with, or consent of the NDTV founders, who, like NDTV, had been made aware of this exercise of rights only today,” they said in a statement on 23 August.

The Roys later claimed they were not legally permitted to transfer the shares, citing a provisional 2017 ban on alienating their stake by the income tax department as part of a tax reassessment. Adani Group disputed this, stating that it was a delaying tactic.

The group said in a statement that it was evident that the RRPR’s letter was issued with the intent to “further inordinately delay” and “seeks to justify RRPR’s default” in compliance with its obligation as set out in the notice and completing the formal steps of allotment of equity shares of RRPR to Vishvapradhan Commercial.”

In its open offer, the Adani Group was able to purchase 8.26% of NDTV’s shares as the offer price of 294 per share was significantly lower than the 376.55 price at which the company closed on the day the offer was announced.

On Friday, shares of NDTV rose 2.7% to 340.60 on BSE.

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