Photo: Kamlesh Pednekar
Vishvapradhan Commercial Pvt Ltd
(VCPL) has decided to appeal against the Securities and Exchange Board of India's (Sebi's) order issued last Tuesday directing the company to make an open offer within 45 days to acquire shares of NDTV Ltd.
The reason for the Sebi order was that VCPL
has indirectly acquired control of over 52 per cent of the media company without making an open offer. Sources close to Vishvapradhan confirmed that the company has decided to appeal against the decision in the Securities Appellate Tribunal
-- a statutory body that has been set up to hear appeals against Sebi orders.
Sebi has also directed VCPL
to pay 10 per cent interest along with the offer to all shareholders who owned the shares of the media company when the stake was bought over. The regulator has justified the action saying that VCPL
has violated the takeover norms of the Sebi Act.
It says that the company bought the stake through convertible loans worth Rs 3.5 billion (Rs 350 crore) that were given to the promoters of NDTV. This transaction, they say, was not meant to be just a loan transaction but was intended for the acquisition of controlling interest in the company and was couched as a loan agreement.
With the Sebi order, the share price of NDTV has risen substantially in the past few days, going up from Rs 38.80 on June 27 to Rs 56.30 on July 2.