SAT quashes SEBI's order against former NDTV promoters Prannoy Roy, Radhika Roy

Oct 5, 2023

In November 2020, Sebi had investigated two separate cases against promoters of NDTV. While one involved loans taken by promoters of NDTV from Vishvapradhan Commercial Pvt. Ltd, the other included a case of insider trading.

In both the orders, Sebi had imposed a ban of two years on the promoters. They were restrained from accessing the capital markets. On 20 July this year, SAT overruled the ban in the VCPL loan case stating that the findings and directions are not sustainable. The matter pertains to Sebi findings that Prannoy Roy and Radhika Roy indulged in insider trading in the scrip of NDTV between 1 September 2006 and 30 June 2008.

Sebi had alleged that the Roys had together bought 48,35,850 shares of NDTV on 26 December 2007, for a value of ₹19,34,34,000. By dealing in shares of NDTV while in possession of unpublished price-sensitive information, the Roys violated the provisions of insider trading, said the market regulator in its order on 26 November 2022.

Meanwhile, in March this year, Adani Enterprises, through its indirect subsidiary RRPR Holdings, acquired additional 1.76 crore shares of NDTV for around ₹602 crore ( ₹342.65 apiece) from the Roys, amounting to 27.26 percent in the company. The Adani Group owns 64.71% in NDTV after acquiring Roy’s stake.

On 23 December, Roys announced their plan to sell part of their stake to the Adani Group, while keeping only 5 percent in the company they founded. The transfer was done on Friday morning in four block deals.

It all started in August when the Adani Group acquired Vishvapradhan Commercial, a company that extended a loan of ₹403.85 crore to RRPR Holding in 2009-10 in lieu of warrants, convertible into a 99.9 percent stake in RRPR Holding if the loan was not repaid.

[Mint]