New Delhi: In what comes as a major setback, journalists and founders of NDTV, Radhika Roy and Prannoy Roy, have been barred from holding any managerial position in the television media company.

The Securities and Exchange Board of India (SEBI), through an order released on Friday, also barred the couple and RRPR Holdings, the company through which they own a stake in NDTV, from accessing, or even associating with the capital markets for two years. 

"Noticee no. 2 and 3 are restrained from holding or occupying position as Director or any key managerial personnel in NDTV for a period of two (2)years; and(iii)Noticee no. 2 and 3 are restrained from holding or occupying position as Director or any Key Managerial personnel in any other listed company for a period of one (1)year.56.The above directions shall come into force with immediate effect," SEBI said.

The ownership of Delhi-based 'wholesale trading' firm VCPL, incorporated in 2008, is said to have later changed hands from RIL to the Nahata group, from which the Mukesh Ambani-led firm had bought Infotel Broadband in 2010 to re-enter the telecom business.

Earlier last year, SEBI had ordered VCPL to make an open offer for NDTV Ltd for indirectly acquiring control of up to 52 percent stake through a convertible loan of Rs 350 crore in 2009 'sourced' from a subsidiary of Reliance Industries Ltd.

In its latest 51-page order, the Securities and Exchange Board of India said all its directions, including debarment of RRPR, Prannoy Roy and Radhika Roy from buying, selling or otherwise dealing directly or indirectly in securities, or being associated with the securities market, will come into effect immediately.

Their existing holdings, including mutual fund units, will remain frozen during the prohibition period, the board added. 

SEBI said the probe began after receipt of complaints in 2017 from Quantum Securities Pvt Ltd, a shareholder of New Delhi Television Ltd (NDTV), about the alleged violation of rules by non-disclosure of material information to the shareholders about loan agreements with VCPL.

The ICICI Bank loan had a clause wherein the three promoters of NDTV had undertaken not to permit any major corporate restructuring, merger etc. without the prior written approval of the lender.

Investigations found that another loan agreement was signed with VCPL for a loan of Rs 350 crore later, which did not carry any interest rate, to repay the ICICI Bank loan that had an interest rate of 19 per cent.

However, one of the terms of the new loan effectively gave VCPL control over the entire shareholding of RRPR Holdings. The agreement gave further significant powers to VCPL, and it was significantly material and price-sensitive, as per the order.

A second loan agreement for Rs 53.85 crore was also signed with VCPL a year later that provided for the promoters of NDTV allowing the lender to indirectly acquire 30 per cent stake in the media company through the conversion of their warrants into equity shares of RRPR Holdings.

It was alleged that by concealing such material information from the public shareholders for a period when the promoters were themselves dealing in the company shares, they had committed a fraud on the minority public shareholders.

Noting that the company was bound to intimate such material information to the public shareholders to help them make an informed investment decision, SEBI said, "the loan agreements were unmistakably structured as a scheme to defraud the investors by camouflaging information about the adversarial terms and conditions impinging upon the interest of NDTV's shareholders."

(With inputs from agencies)