SEBI imposes Rs 27-crore fine on promoters of NDTV

SEBI has imposed a penalty of Rs 27 crore Prannoy Roy and Radhika Roy, on New Delhi Television Ltd (NDTV) promoters as well as on RRPR Holding for violating various securities norms by concealing information from shareholders regarding certain loan agreements. RRPR Holding is a promoter entity of (NDTV).

According to SEBI, certain loan agreements had clauses that have adversarial effect on the NDTV shareholders.The regulator said that its probe began after receipt of complaints in 2017 from Quantum Securities Pvt Ltd., a shareholder of NDTV about an alleged violation of rules by non-disclosure of material information to the shareholders about loan agreements with VCPL.

While one loan agreement was with ICICI Bank the other two were with Vishvapradhan Commercial Private Ltd (VCPL).

As per SEBI, an agreement was signed in 2009 with VCPL for a loan of Rs 350 crore to repay the ICICI Bank loan and a second loan agreement with VCPL was signed for Rs 53.85 crore, a year later. These loan agreements included clauses and conditions that substantially affected the functioning of NDTV, SEBI said in its 52-page order.

Further, one of the terms of loan agreements allowed VCPL to indirectly acquire 30 per cent shareholding of NDTV through conversion of warrants into equity shares of RRPR Holding.

The Roys have contended that NDTV was not a party hence there was no requirement for them to make disclosure of the agreement to the stock exchanges.