Adani takes control of NDTV

Adani group now holds 64.71 per cent of New Delhi Television Ltd (NDTV), according to a regulatory filing.

New Delhi: Adani group on Friday gained full control of news broadcaster NDTV after it acquired most of founders — Prannoy Roy and Radhika Roy — stake at a premium of almost 17 per cent over the rate it paid to minority shareholders of the firm. Adani group now holds 64.71 per cent of New Delhi Television Ltd (NDTV), according to a regulatory filing.

The group run by Asia’s richest man Gautam Adani used RRPR Holdings Private Limited, a company that was founded by the Roys and bear their initials in its name, to buy 27.26 per cent shares from Prannoy Roy and Radhika Roy at a price of Rs 342.65 per share, it said. The price paid to Roys, which translates into Rs 602 crore, is almost 17 per cent premium to Rs 294 a share Adani Group had offered in an open offer to minority shareholders after taking control of RRPR Holdings.

Shares of NDTV closed at Rs 345.60 apiece on the BSE. Prannoy Roy held 15.94 per cent stake in NDTV, of which, he has sold all but 2.5 per cent stake. His wife Radhika Roy too sold all but 2.5 per cent of the 16.32 per cent stake she had in NDTV.

Adani Group first acquired Vishvapradhan Commercial Private Limited, a little-known company that had given Rs 403 crore of an interest-free loan to RRPR Holdings in 2009-10 in exchange for warrants that allowed it to buy a stake in the newsgroup at any time. Adani group exercised those rights in August this year, which NDTV said was done without its consent. By virtue of that, the Adani group took control of RRPR Holdings, which held a 29.18 per cent stake in NDTV. Thereafter, it made an open offer to acquire an additional 26 per cent from public shareholders.

That open offer found investors willing to sell over 53 lakh shares of NDTV despite the deep discount on the stock’s trading price. The stock tendered translated to an 8.26 per cent shareholding. Its stake through RRPR Holdings, open offer acquisition and buying 27.26 per cent from Roys have now given Adani group full control of NDTV with a 64.71 per cent interest. Market experts said Adani group paid Roys a higher price using a so-called inter-se transfer or share sale between entities linked to NDTV’s owners, which allows paying a premium. RRPR Holdings is an existing NDTV holding company that has bought shares from Roys.

Also, Adani group announced the share purchase from Roys a full 18 days after the close of the open offer – a timeframe that allows the takeover code not to kick in.

“RRPR, an indirect subsidiary of the company and member of the promoter/promoter group of NDTV, has acquired a 27.26 per cent equity stake in NDTV from Prannoy Roy and Radhika Roy by way of inter-se transfer…,” said a regulatory filing from Adani Enterprises.