As social media cites the entire deal as the death of journalism and free speech in India, contends, that Modi deliberately made Gautam Adani acquire NDTV. Well, before making such claims, one must understand and know every minute detail and information from the very start related to the entire deal to come to any sheer conclusion. NDTV is the short form for New Delhi Television Limited and it was founded in the year 1988. It was the very first independent news network in India.

During the period of 1980s private organisations didn’t have permission to broadcast news, and in that situation, it was NDTV which was the first ever news channel in India that collaborated with Door darshan to launch an International show. It was also the very first news channel to broadcast news 24/7 and get listed on the stock market. On 23 August, Adani group through a press release claimed about holding 29.18% shares of NDTV. NDTV in response to it said that they have been tricked by the Adani group over the same. Coming to the share breakup of NDTV, the company has a total of 6 crores and 44 lakh shares. Out of this 16.32% of shares are held by Radhika Roy and 15.94% of shares are with her husband Prannoy Roy who are the founders of the news channel. Apart from that, they both through a company RRPR Holding Pvt. Ltd. (Radhika Roy and Prannoy Roy Holding Pvt. Ltd.) have a shareholding in NDTV with 29.18% shares. 28.81% of shares are public shares which are listed in the share market and can be purchased or sold by common people. The rest 9.75% of the shares belong to LTS Investment Funds which is an MNC which have also invested a huge amount (98% of their money) of money in the Adani groups as well. Thus in all Radhika and Prannoy Roy holds 61.44% shares of the company. The company is owned by these 2 individuals only. Now, let's have a close look at some series of events and understand how NDTV went into the hands of Adani:

1. Power of NDTV

Before 2007, everything was going cakewalk for NDTV and it was at its peak. It was so powerful that even when one of the events which were in collaboration with Star was launched, it was from the PM’s “Inder Kumar Gujral” house, so one can estimate easily the channel's popularity as well as power. If one looks at the team of people they hired for working with them during that period, one can more easily estimate how powerful NDTV originally was.

2. What happened in 2007?

In 2007, Prannoy Roy and Radhika Roy decided to buy back their shares. "Buyback" means that when the company needs some money sells some shares of their company and in return raises money from people or the public. And, when the company has enough money and resources and the share price is low, they buy back those shares from people. So, a similar scenario happened in this case. The Roys decided to buy back shares from GA Global Investments in 2007. They held 7.73% shares of NDTV. At the time of purchase, the price of one share of NDTV was about 400 rupees, but they decided to offer 439 rupees for each share and this price was readily accepted by GA Global Investments. For this, they required a huge amount of money and for the same, they loaned the entire amount from Indian Bulls Financial Services. In July 2008 they took a loan of 501 crores from them. Soon after their share purchase, the US faced an economic crisis which led to a market crash due to which all stock prices tended to touch their all-time bottom low and the market crashed. The share which they purchased for 439 rupees dropped to just 100 rupees per share.

3. Repaying the Loan

Now as the amount was getting bigger day by day, and the market continued to crash and collapse, they decided to repay the loan by taking another loan. This time they took 375 crores from ICICI at a tremendous interest rate of 19%. For the same, they kept the RRPL shares at stake. In 2008, NDTV even fired their 250 employees which were 20 per cent of the workforce as the time for repaying the loan was nearing.

4. Taking another Loan

As the deadline to pay back the loan was nearing, to pay back to ICICI, they again took a loan of 403.85 crores from VCPL (Vishwapradhan Commercial Private Limited). In return for a loan, VCPL didn’t take any security from them, nor charged even a single penny interest from them but in return, they demanded to sign up on an agreement that said that demanded shares held by RRPL i.e. 29.18% of the shares as equity warrants. That’s if needed, VCPL can convert them and take 99.99% stakes in the company. Equity warrants, meaning that the company won’t be taking the shares now but in case the company needs them in future it will take them in case of inability to pay back the loan. But here, they also put another condition that even after the loan is repaid, VCPL can still take the 29.19% shares of NDTV help by RRPR. Apart from that VCPL also took indirect control over RRPR i.e. everything related to deciding how the company will work, and who will take a further decisions, all these things will be decided by VCPL. Apart from that, the three directors of RRPR were also appointed by VCPL. They also put another condition that none of the equity of the company can be raised or sold and neither the company can file for bankruptcy. This effectively means that RRPR can do nothing without the permission of VCPL that would affect the shareholding of the VCPL in the company. From here, it was almost confirmed that in the future RRPR will be sold as 29.18% is a big share of the company that was already gone. Adani took advantage of this only. Now, if this thing would have come public it would have led to negative marketing which might have severely affected the share prices of NDTV and that was the reason why the Roys decided to keep it private and not even disclose it with their investors. The thing NDTV did was severely against the rules and regulations set by SEBI (Securities and Exchange Board of India) due to which NDTV founders also had to face several CBI and SEBI enquiries.

5. Enquiry was Setup

When an enquiry was set up it was realised that VCPL was acting like a shell company i.e. the company was formed for the purpose of doing some other task but originally it has been doing something other. Upon further investigation, it was revealed that VCPL was Mukesh Ambani’s company. It meant for many years NDTV was under Mukesh Ambani’s control. VCPL didn’t originally by themselves gave a loan to RRPR rather they took the amount from a company Shinano Retail and gave it to them. Shinano Retail also without any security or interest rate gave the loan to VCPL even though VCPL was opened that year itself i.e. in 2008 only and even had no assets or transaction history. When further found out, it was discovered that Shinano Retail also took the money from Reliance Industries and Holding Limited which was a part of Reliance Group which is Mukesh Ambani’s company. Now, many people will think that NDTV founders might have been unaware of this entire thing, but they were very well aware of all of this that their company control is going under Ambani’s control. When the deal was signed, on behalf of RRPR Prannoy and Radhika signed the agreement while from VCPL, it was signed by KR Raja who was a top management employee in Reliance during that time and NDTV founders were well aware of this. Coincidently, when all of this happened NDTV also invited Mukesh Ambani and gave him the NDTV Profit Global Indian Award in the year 2008.

6. Transfer of Ownership

In 2012, the ownership of VCPL was transferred to Nextwave Televenture Private Limited and Skyblue Buildwell Private Limited. NTPL belonged to Mahendra Nahata who was the then director of Reliance Jio Infocom Limited. On 23 August 2022, NTPL was taken over by Adani-owned AMG Media Networks Limited. VCPL was unable to recover the loan and thus Adani to recover the amount used the equity warrant of shares of RRPR and took over all the shares of NDTV. But still, the Roys have a share of 32.27% in the company. Now, as per SEBI regulations, if any company takes shareholding of more than 25% in a company then in that case the company has to mandatorily throw an offer on buying more shares from other shareholders in return for money and exceed their shareholding over 50% and become the owner of the company. The Roys were worried about the ownership of the company, as it was possible that Adani may raise his shares over 50% in the company and become the owner. Now, this could also have been done by the Roys, as they can also exceed their shareholdings by about 50% but they both were banned by SEBI for 2 years i.e. till 25th November 2022. This ban was imposed on them in the year 2020 on account of enquiry on trading and other charges. On 25th August, the Roys wrote a letter to BSE and NSE regarding the same and quoted the takeover as illegal as the Adani group had the freedom to buy and sell shares but the Roys didn't have that freedom.

7. What if SEBI took action?

Even after SEBI would have agreed upon it, and stopped Adani to acquire further holdings, there was still one setback as Adani could have still bought shares from the 2 foreign companies who have 14.17% shares of NDTV (LTS investment Fund + Visaka India EIF Fund – Both are Mauritius based funds). Both these companies have a heavy investment in the Adani group and it might be possible that they will sell their holdings to Adani. As of now, Adani has given an offer to people to take 294 rupees per share from them and give the share to Adani soon after which the NDTV stock prices have been skyrocketing. The current price of NDTV stocks is 371 rupees.

8. The reason why big names want to enter the Media Industry?

The reason why such big giants as Reliance (owns Network 18 etc) and Adani want to enter the media industry is that these companies don’t enter the media industry for money purposes but rather to acquire power and control and have negotiations with the government. AMG media has also purchased 49% shares in the company “The Quint” owned by Quint Digital Media. Being in the media industry gives one the power to have a powerful influence over people and aids a lot while dealing with the government.

Now, many people say that people will become Bakhts and all channels in the mainstream media will become pro-government because of this. The case is not so and neither the deal has been done because of any political or government pressure. The entire acquisition has been done from a business point of view. Even the shareholder knows about the current audience of NDTV and they know that if they change the content to pro-government the audience will not turn into pro-government rather they will switch to other channels and platforms for watching and thus they won’t do such big blunders.

Latest Updates:

1. Adani group have 37.5% shares of NDTV.
2. Soon after the acquisition, Ravish Kumar left NDTV soon after he took over and expressed his serious concerns over the death of journalism in the country as news channels are no more than a puppet of big industrialists and political parties. He has started his very own YouTube channel where he will continue his further practice.

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