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July 13 To July 19, 2019 u Taxmann’s Corporate Professionals Today u Vol. 45 u 40Key Managerial personnel in NDTV for
a period of two (2) years; and
(iii) Dr. Prannoy Roy and Ms. Radhika Roy
are restrained from holding or occu-
pying position as Director or any Key
Managerial personnel in any other listed
company for a period of one (1) year.
Later on, Dr. Prannoy Roy approached The
Securities Appellate Tribunal (hereinafter
referred to as SAT) against SEBI’s verdict.
SAT granted interim stay on part of SEBI’s
order till the next hearing.
SAT, in its order dated June 14, 2019, ob-
served that the impugned order had been
passed restraining the Dr. Prannoy Roy and
Ms. Radhika Roy from occupying a position
as a director or in any key managerial per-
sonnel in NDTV for a period of two years.
“Such orders prima facie would not be in
the interest of the shareholders of NDTV or
for that matter, the investors at this stage,”
SAT said.
It further said that, the Promoters shall not
alienate or create any encumbrance on their
shareholding in NDTV till further orders.- Facts of the Case
(1) RRPR took a loan of `350 crores from
ICICI Bank Limited (hereinafter referred
to as “ICICI”) which carried interest at
the rate of 19% p.a. This loan was re-
quired to be repaid within a stipulated
period. A Loan agreement was executed
between ICICI Bank and RRPR Hold-
ings Pvt. Ltd., and as per the said loan
agreement the promoters of NDTV had
undertaken not to permit any merger,
de-merger, consolidation, reorganization,
scheme or arrangement or compromise
with its creditors or shareholders or
effect any scheme of amalgamation or
reconstitution of NDTV without the prior
written approval of ICICI.
(2) When NDTV found it difficult to repay
the interest and principal amount, RRPR
Holding Pvt. Ltd., took two loans from
Vishvapradhan Commercial Private Lim-
ited (hereinafter referred to as “VCPL”)
totalling approximately to ` 400 crores
in July 2009 and in January 2010. RRPR
Holding Pvt. Ltd. held shares of NDTV
which is a listed company. Based on the
loan taken from VCPL it is alleged that
the loan of ICICI was liquidated. While
taking a loan from VCPL certain agree-
ments were entered into under which
VCPL had given interest free loan for
a period of 10 years on the condition
that the principal amount would be paid
within 10 years and that the VCPL will
have a right of first refusal on 50% of
the shares in the event the said shares
are sold in the market.
(3) Further, a call option agreement was
made whereby an option was given
to two associates of VCPL for transfer
of 30% of the shareholding of RRPR
Holding Pvt. Ltd. to it at the price of
` 214.65 per share. It was stated that
at the time when the loan agreement
was executed the price of the NDTV
share was `130 per share. It was also
stated that the price of 214.65 per share
was fixed in order to cover the loan
amount of ` 403.85 crores. That call
option was never exercised.
4)( The agreement further stipulated that
RRPR. Would have the sole control
and will not sell the shares without the
right of the first refusal by the lender,
namely, VCPL.
(5) One of the pre-conditions set out during
the execution of Loan Agreement with
VCPL was that the Dr. Prannoy Roy
and Ms. Radhika Roy (promoters of
NDTV) shall transfer 1,15,63,683 shares
of NDTV to RRPR so that the total
number of shares of NDTV held bySEBI V. NDTV - DOES FINANCING ARRANGEMENTS AMOUNTS TO EXERCISING ‘CONTROL’