The share price of New Delhi Television Limited (NDTV) surged 5 per cent to hit the upper circuit limit, on Wednesday, a day after AMG Media Networks Limited (AMNL), a wholly owned subsidiary of Adani Enterprises Ltd, announced that it would acquire a majority stake in the news channel company. The announcement was allegedly without the consent of NDTV founders and was termed “hostile”.
AMNL announcement was in the wake of Vishvapradhan Commercial Private Ltd (VCPL), wholly owned subsidiary of AMNL exercising its rights to acquire 99.5 per cent of the equity shares of RRPR Holding Private Limited, a promoter group company of NDTV.
AMNL’s wholly owned subsidiary VCPL holds warrants of RRPR Holding Private Limited (RRPR) entitling it to convert them into 99.99 per cent stake in RRPR. VCPL, has reportedly exercised these warrants to acquire 99.5 per cent stake in RRPR.
However, media reports, citing an earlier order of the Securities Appellate Tribunal (SAT), said on Wednesday that the loan agreement executed by the NDTV promoters with VCPL did not transfer control of NDTV to VCPL either directly or indirectly. Therefore, the findings given by the administrative official on the issue that the loan agreement is structured in such a way that, in fact, it transfers control to VCPL indirectly cannot be sustained and therefore the AMNL’s takeover bid may hit a roadblock.
On the BSE, the share price of NDTV opened at Rs 380 and hit the upper circuit limit of Rs 384.50 soon after the opening of the trade on Wednesday against its previous day’s close at Rs 366.20. This is the highest level of NDTV shares in the past one year. The 52-week low of NDTV share was Rs 71.15.
Adani Group had yesterday said that it has acquired 29.18 per cent stake in the news channel company by converting debt into equity. The group also said that it would acquire another 26 per cent stake in NDTV through an open offer.
