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The notorious tussle for ownership between the Roys and Adani, in the publicly traded company NDTV has been doing rounds in the media when the media arm of the Adani conglomerate, AMG Media Network Limited on August 23, 2022, announced that it will indirectly acquire a 29.18% in the Company. The announcement came after the Adani group company acquired a 100% equity stake in VishwaPradhan Commercial Private Limited.

Soon thereafter, NDTV released a statement that said, the Company and its Founders were neither aware of the acquisition nor have they given their consent to it. Apparently, the acquisition was not a quintessential one, it was hostile. But how did this all happen? How did Adani acquire a major  stake in the Company without any consent of its Promoters?

Well, the answer to this lies in History. It was indeed a cycle of loans and murky finances which has haunted the Roys till date!

The tale begins in 2007, when NDTV was flourishing and their share prices were ascending to new heights. It was then, when the promoters of NDTV Radhika and Prannoy Roy decided to buy back 7.73% stake from GA Global Investments which indeed triggered an open offer as per Regulation 3(2) of the Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeovers) Regulations, 2011. However, the promoters of the company were keen on buying back the shares, probably for increasing their stake in the company or that they anticipated that the company shall perform better, eventually leading to a rise in the stock prices. Whatever the reason may be, the deal to buy back the shares along with catering to an open offer rather proved to be sumptuous to the Roys, as the buyback of the shares was priced at 439 albeit NDTV shares hovering at around 400, at that time. In order to fund this massive deal, NDTV promoters took a loan of Rs. 501 crore from Indiabulls Financial Services Limited (IFSL) by pledging their shares as security.

However, the buyback did not seem to be opportune for the Roys and trouble ensued soon after they availed this humongous loan from IFSL to fund the buyback and the open offer by pledging their shares as security; as the global economy was struck by recession due to the housing loan crisis in the United States leading to a drastic collapse of NDTV’s stocks. The stocks went from around 400 at the end of July 2008 to less than 100 by the end of October 2008. Since the stocks descended, the shares pledged with IFSL lost most of its value and hence IFSL asked the promoters to pay back its loan.

Now, in order to pay back the loan of IFSL the Roys took another loan of Rs. 375 crore from ICICI bank which bore an interest rate of 19%, by pledging their entire personal holding as well as that of our RRPR Holdings Pvt. Ltd. (Radhika Roy Prannoy Roy Holdings Pvt. Ltd. was a promoter group of NDTV) of more than 61.45% with the bank.


Since, the loan availed from ICICI bore a huge interest burden and NDTV was going through a hard time, the promoters, in order to get away with the interest burden, took another loan of Rs. 350 crore in July 2009, from a Company named VishvaPradhan Commercial Private Limited. A loan agreement was duly executed between RRPR Holdings Private Limited and VCPL. But wait! The terms of the loan agreement were extraordinary. A mere perusal of which can easily daunt an individual. The terms stated that:

Loan Agreement

At the Borrower’s request, subject to the terms and conditions set out in this Agreement, the Lender agrees to lend and advance to the Borrower and the Borrower agrees to borrow the sum of Rs. 350 crores  (Rupees Three Hundred and Fifty Crore only) (being the Loan). The Loan shall not carry any interest. Notwithstanding anything contrary in this Agreement, the Loan disbursed shall be repayable on the Maturity Date.


6.1 The Borrower shall issue a convertible warrant (the “Warrant”), convertible into Equity Shares aggregating to 99.99% of the fully diluted Share Capital of the Borrower at the time of conversion, to the Lender immediately upon execution of this Agreement. The Warrant shall be subject to the terms and conditions set out in Schedule 1.

6.2 The Lender shall have the right to purchase from the Promoters all the Equity Shares of the Borrower held by the Promoters at par value.

6.3 The Lender and its Affiliates shall not purchase shares of NDTV which will increase their holding in the aggregate to more than 26 percent of the paid up Equity Share Capital of NDTV without the consent of the other Parties.


9.2 (e) Sale of 1,15,63,683 (one crore fifteen lakh sixty three thousand six hundred eighty three only) equity shares of NDTV from the Promoters to the Borrower such that upon such sale the Borrower holds 1,63,05,404 (one crore sixty three lakhs five thousand four hundred four only) Equity Shares of NDTV aggregating to 26% of the equity share capital of NDTV (adjusted for Adjustment Events) & such transfer qualifying under Regulation 3(1) of the Securities Exchange Board of India (SAST) Regulations, 1997 (as amended, maried or supplemented from time to time).



(a) At the sole option of the Lender, the Warrant may be converted into such number of Equity Shares at par aggregating to 99.99% of the fully diluted Equity Share Capital at the time of conversion of the Borrower at any time during the tenure of the Loan or thereafter without requiring any further act or deed on the part of the Lender.



2. Matters relating to NDTV or NDTV Group which require prior written consent of Lender 

a) Issue any Equity Securities of NDTV which results in the aggregate valuation of NDTV being less than Rs 1346 crores (valuation at which Lender has put money into the Company);

b) Merger, amalgamation or consolidation of NDTV with any other entity; 

c) Cause NDTV or any Person in NDTV Group to take any steps towards bankruptcy, insolvency or reorganisation, arrangement, adjustment, winding up, liquidation, dissolution, composition or other relief with respect to it or its debts or seeking appointment of a receiver, trustee, custodian or other similar official for it or all or any substantial part of its property 

d) Buy back of Equity Securities, reduction or alteration of the share capital of NDTV;

e) Take any action to use any Equity Securities or enter into any agreement as a result of which the Promoters cease to be in sole control of NDTV or the NDTV Group.

Further, on 9th March 2010, RRPR availed an additional Rs. 53.85 crores from VCPL, by again divesting 3.18% of their personal holding in NDTV to RRPR, thereby taking RRPR’s shareholding in NDTV to a whopping 29.18% by executing a similar loan agreement as that of 2009.

Murkier terms, weren’t they?

Now, the terms of the loan agreement mentioned that the loan shall be interest free. But, is there ever a free lunch? It tantamounts to a mirage or I would rather say a nightmare. Why? Because VCPL practically acquired 29.18% stake of NDTV at that time itself when it mentioned in the agreement that it can exercise its right of converting the loan into 99.99% of RRPR’s equity- effectively complete ownership, at any time during the tenure of the loan or anytime thereafter. Yet, the Roys agreed to such an arbitrary term! Can we not say that NDTV was symbolically transferred to the tune of 29.18% back then, when the Roys agreed to convert their warrants to Equity of their Company?

This transaction rather led to a series of litigation upon the Roys. What? How? Read on.

Through this loan received from VCPL the Roys settled the ICICI loan of Rs. 375 crore by Rs. 350 crore only. Here, it is pertinent to note that the settlement transaction between ICICI and the Roys is under probe by SEBI, on a complaint filed by Mr. Sanjay Dutt who is a director of Quantum Services Private Limited. Mr. Dutt is no stranger to NDTV. He holds a long standing relationship with the company, he has been a consultant to NDTV, a minority stakeholder in the company as well as a stock broker.

Another dispute which arose in the loan transaction between RRPR Holding and VCPL was with the Income Tax authority, allegedly with regards to the tax evasion by the Roys while executing the aforesaid loan agreement. The Roys had transferred the shares of NDTV to RRPR at a much lower price than what was prevailing in the market, probably to evade taxes on capital gains as alleged.



VCPL, a company that was incorporated in 2008 dealing in wholesale trading and related business activities lends a whopping Rs.  403 crores to RRPR Holdings Private Limited within just a year of its incorporation. How did this happen? Where did the money come from? VCPL had no assets, businesses or transactions on its books before the NDTV loan. Moreover, in a probe, the SEBI order observed that VCPL had merely a revenue of Rs.60,000 in 2017, but on the assets side it had a lending of more than Rs. 400 crore as long term loans and advances. Dubious, right? Well, actually not! The money was lent to NDTV by Reliance, via VCPL. There was a money trail involved. In order to bailout the Roys from their financial crisis back in 2009, VCPL took a loan of Rs. 403 crore from Shinano Retail Private Limited (a wholly owned subsidiary of Reliance industries Limited). Shinano Retail Private Limited in turn,  took a loan of Rs. 403 crore from Reliance Group of Companies.

The past directors of VCPL, Mr. Ashwin Khasgiwala and Ms.Kalpana Srinivasan were both employees of Reliance. VCPL’s second owner M/s Eminent Networks was also owned by Mr Mahendra Nahata, who was a director on the board of one Reliance company. 


Surprisingly, in 2012, Shinano Retail Private Limited declared in its annual report that it had received Rs. 403 crore lent to VCPL. This disclosure, thus severed the indirect control of Reliance over RRPR. However, that disclosure was mysterious enough as RRPR books yet bore the burden of the loan. Evidently, the money did not flow from RRPR. So, from where did the money come to Shinano? This discussion can rather be a subject matter of an entire separate article. 


As of today, the Adani group subsidiary AMG Media Networks Limited has acquired 100% stake of VCPL for Rs. 113 crore on 23rd August 2022,  thereby exercising their rights to convert 99.99% stake of RRPR  into equity shares with reference to the loan agreement executed between VCPL  and RRPR Holding Private Limited, back in 2009. This exercise shall give the Adani group a 29.18% stake in NDTV, as was held by RRPR, which was, practically by all means, sold to VCPL in 2009 itself, by executing the arbitrary agreement merely for the purpose of procuring the loan.

Once RRPR transfers its 29.18% shares to AMG Media Networks Limited via VCPL, the Adani group company,  then, shall be mandated as per Regulation 3(2) of Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeovers) Regulations, 2011, to make an open offer to buy at least 26% of shares from the market.

Citing the SEBI ban vide order dated November 27, 2020 which restrained the Roys from dealing in the Securities market for 2 years, NDTV said that VCPL along with AMG Media Networks Limited will need SEBI’s approval to acquire 99.99% i.e 29.18% stake in its promoter group. The Adani group has refuted the same by stating that the SEBI ban was binding upon the promoters individually and not on RRPR Holdings Private Limited.

We’ve spoken about “open offer”, what is it, though?

An open offer is an exit option available to the existing shareholders of a company when there is a significant change in ownership and/or management. When an investor invests in a company the basic factors upon which one’s decision depends are the management, business strategy, profitability, liability, long term prospects  and various other factors. Now, when an acquirer steps in, most of these factors are subject to change and hence the initial fundamentals on which an individual based his decision to invest in a particular company would no longer sustain. Hence, in order to give a suitable exit option to the shareholders who are caught up in a situation where they do not want to continue with the new management, an open offer is mandated. 

When is an Open Offer triggered?

An open offer is triggered when an acquirer who (along with the PAC’s if any) holds less than 25 % shares or voting rights in a target company agrees to acquire shares or acquires shares which along with his/PAC’s existing shareholders would entitle him to exercise 25% or more shares or voting rights in a target company. He would have to make an open offer before acquiring such additional shares.

An open offer is also triggered when an acquirer who (along with the PAC’s if any) holds more than 25% shares or voting rights  but less than the maximum permissible non-public shareholding, desires to acquire such  additional shares which would entitle him to exercise more than 5% of voting rights in any financial year. In order to acquire such additional shares an open offer is mandated.

No open offer is required to be made if the acquisition is below 5%.

(PAC– Persons Acting Concert or PAC are individual(s)/company (ies) or any other legal entity (ies) who hold a common objective or purpose of acquisition of shares or voting rights in, or exercise of control over the target company, pursuant to an agreement or understanding, formal or informal, directly, co-operate for acquisition of shares or voting rights.)


Well, as per our perusal of the documents available in the public domain, the legal recourse available are paltry to keep the wheels of NDTV moving with the Roys.  

  1. Radhika and Prannoy Roy together hold a 32.26% stake as individuals in NDTV. Now, the Roys can bid to buy back their shares from the market at a higher price than that offered by the Adani subsidiary. However, that would indeed be a tug-of-war between the Roys and the Adanis! 
  1. Clause 6.3 of the Loan agreement:

6.3 The Lender and its Affiliates shall not purchase shares of NDTV which will increase their holding in the aggregate to more than 26 percent of the paid up Equity Share Capital of NDTV without the consent of the other Parties.

This term may be a beam of light in the gloom for the Roys. However, the chances of winning in an argument over the set clause a meagre as the other terms in the agreement subjugate the same.

Hypothetically, a white knight can act as a saviour!


So, if we see Promoter pledging can indeed be a nightmare for an entity. It would definitely be a mere relief to the wound for the time being, however, it would lacerate the same wound over time. Nonetheless, Roys move to fortify their control over NDTV by buying back shares, has rather brought them on the verge of losing a significant stake!


  1. SEBI’s order dated 24th December 2020 in  the matter of NDTV.
  2. The Caravan- Mr. Krish Kaushik’s Coverage on the ICICI- NDTV Loan transaction.
  3. Live mint.
  4. NDTV’s Financial Statements


Ms. Madhat J Shaikh

Intern – M/s Lawkhart Legal

Reporting to Adv. Raghavendra S. Mehrotra

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The information contained in this Article is intended solely to provide general guidance on matters of interest for the personal use of the reader, who accept full responsibility for its use. The application and the impact of laws can vary widely based on the specific facts involved. As such, it should not be used as a replacement for consultation from a competent legal advisor. The content described in the article are purely based on facts and figures available in the public domain and in no way represent any views or opinion of any member of M/s Lawkhart Legal- Advocates & Legal Consultants.

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    Sujit Kumar Singh

    Lawkhart legal is professional organization having all kinds of expertise in dealing with legal disputes and is a result oriented organization


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