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Baseless, legally untenable and devoid of merit: Adani Group responds to allegations of a ‘hostile takeover of NDTV’ without consent of promoters

In a statement on Friday (August 26), it said, "We hereby inform you that VCPL has received a reply on behalf of RRPR to the warrant exercise notice dated August 23, 2022, for the exercise of the 1,990,000 warrants into 1,990,000 equity shares of RRPR, contents of which were also disclosed by NDTV in its disclosure dated August 24, 2022."

Days after New Delhi Television (NDTV) accused the Adani Group of acquiring a 29% stake in the company without consent, the Indian multinational conglomerate has responded to the allegations.

In a statement on Friday (August 26), it said, “We hereby inform you that VCPL has received a reply on behalf of RRPR to the warrant exercise notice dated August 23, 2022, for the exercise of the 1,990,000 warrants into 1,990,000 equity shares of RRPR, contents of which were also disclosed by NDTV in its disclosure dated August 24, 2022.”

RRPR (a promoter-owned company that owns a 29.18 per cent stake in NDTV) had claimed that written approval from SEBI was required for the exercise of conversion of warrants, a claim dismissed by Vishvapradhan Commercial Private Limited (VCPL).

An indirect subsidiary of Adani Enterprises Limited, VCPL said that RRPR is not a party to the SEBI order, which restricted Prannoy Roy and Radhika Roy from dealing with securities.

“The Warrant Exercise Notice has been issued by VCPL under a contract which is binding on RRPR. RRPR is therefore obligated to comply with its contractual obligations,” it said.

VCPL informed that the exercise of warrants conversion did not violate restrictions imposed on Prannoy Roy and Radhika Roy against dealing in securities by SEBI. As such, it contended that no prior written approval from the regulatory body was required.

“Further, on August 23, 2022, the amount of Rs. 1,99,00,000, being the amount payable for the 19,90,000 equity shares of RRPR pursuant to exercise of warrants, has been paid by VCPL and received by RRPR.,” it said.

“Any subsequent attempt by RRPR to return the money received or the original warrant certificate shall have no legal effect on the exercise of warrants by VCPL which has been completed,”it further emphasised.

While rubbishing the allegations levelled by NDTV, Adani Group said, “The contentions raised by RRPR in the Letter are baseless, legally untenable and devoid of merit. RRPR is therefore bound to immediately perform its obligation and allot the equity shares as specified in the Warrant Exercise Notice.”

The Allegations of Hostile Takeover of NDTV

The term hostile takeover largely means when one company acquires another company against the wishes of the company getting acquired. It may happen when the acquiring company buys shares directly from shareholders of target company.

In this case, the Roys have stated that they were not consulted before Adani Group made the open offer to buy shares to form majority stake after loan or other convertible debt instrument is converted into equity.

Vishvapradhan Commercial Private Limited (VPCL), is company incorporated in 2008. In 2009, it offered unsecured loan to NDTV’s holding company, Radhika Roy Prannoy Roy Holding Private Limited (RRPRH) worth Rs 403.85 crore. RRPRH held 29% equity in NDTV.

VCPL, in same year, had received unsecured loan from Shinano Retail Private Limited, which had obtained money from Reliance Industrial Investments and Holdings Limited, a part of Reliance Group.

Shinano Retail was a fully owned subsidiary of Reliance Group. Since these documents are publicly available, NDTV was aware that it was obtaining unsecured loan from an entity that was linked to Reliance group. For its part, VCPL was owned by Shinano Retail and Teesta Retail Private Limited, another fully owned subsidiary of Reliance Group.

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OpIndia Staff
OpIndia Staffhttps://www.opindia.com
Staff reporter at OpIndia

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