Adani will launch an open offer for NDTV on October 17th

On October 17, the Adani Group will launch its open offer for the acquisition of an additional 26% stake in the media company NDTV. The open offer for the acquisition of 1.67 crore of shares, priced at Rs 294 per share, will close provisionally on November 1, said an announcement from JM Financial, which is managing the ‘offer.

If fully subscribed at a price of Rs 294 per share, the open offer will amount to Rs 492.81 crore,

On August 23, the Adani Group announced that it would acquire a 29.18% stake in NDTV through the acquisition of VCPL, which holds a 99.99% stake in RRPR Holding.

Following this, the Adani group companies – Vishvapradhan Commercial Private Limited (VCPL) together with AMG Media Networks and Adani Enterprises Ltd – have proposed to acquire an additional 26% or 1.67 crore of shares.

Days after this announcement, NDTV’s founding promoters said the deal cannot go ahead without Sebi’s consent.

In an order approved on November 27, 2020, the Securities and Exchange Board of India (Sebi) detained NDTV’s founders – Radhika Roy and Prannoy Roy – from the securities market for two years, and that period ends on November 26.

As the restrictions are still in place, therefore, prior written approval from Sebi for Vishvapradhan Commercial Private Limited (VCPL) was required to exercise the conversion option on the warrants, NDTV’s founders had said.

RRPR Holding Ltd and the Adani group turned to Sebi, seeking clarity on the applicability of the regulator’s previous order regarding the conversion of warrants into shares, which has become a decisive factor in the hostile battle for the acquisition of power of the media group .

Although the Adani Group has already dismissed NDTV’s claim by stating that the promoter entity RRPR Holding is not part of the regulator’s order that has kept Prannoy and Radhika Roy from entering the securities market.

Defining the disputes raised by RRPR Holdings as “unsubstantiated, legally unsustainable and without merit”, VCPL stated that the holding company is “required to comply immediately with its obligation and to assign the shares” as specified in the notice of exercise of the warrants.

VCPL had stated that RRPR is not part of the Sebi order of November 27, 2020 and the restrictions do not apply to it.

The notice to exercise the warrant was issued by its subsidiary VCPL under a binding contract for RRPR, he added.

On 23 August, the Adani Group announced the launch of an open offer to purchase an additional 26% stake in the company, which operates three national news channels: the UK news channel NDTV 24×7, the UK news channel. hindi news NDTV India and the business news channel NDTV Profit.

The key element behind the takeover bid is an unpaid loan that the promoter entity of NDTV RRPR Holding Pvt Ltd used VCPL.

NDTV had taken out a loan of Rs 403.85 crore in 2009-10 and against this amount, the warrants were issued by RRPR. With the warrants, VCPL had the right to convert them into a 99.9% stake in RRPR in the event that the loan was not repaid.

The Adani Group first acquired VCPL from its new owner and exercised the option to convert the unpaid debt into a 29.18% stake in the news channel company.

The promoters of NDTV said they were completely unaware of the acquisition until Tuesday and that it took place without their consent.