SynopsisSebi has closed adjudication proceedings against NDTV without penalty, concluding the company did not violate disclosure requirements. The decision follows a 2022 Securities Appellate Tribunal ruling that the 2009 loan agreement did not constitute a change in control.AgenciesCapital markets regulator Sebi has closed adjudication proceedings against NDTV without imposing any monetary penalty, bringing to an end a long-running disclosure case linked to the broadcaster's 2009 financing arrangement with Vishvapradhan Commercial (VCPL).In an order issued on May 29, SEBI's adjudicating officer held that NDTV had not violated disclosure requirements under the SEBI Listing Obligations and Disclosure Requirements (LODR) Regulations and disposed of the proceedings without any penalty.The case stemmed from Sebi's June 2018 order, which had concluded that VCPL had indirectly acquired control over NDTV through a 2009 loan agreement and related call option arrangements with the broadcaster's promoters. Based on that finding, SEBI had directed VCPL to make an open offer to NDTV shareholders.Following that order, questions were raised over whether NDTV should have disclosed a change in control to stock exchanges. Sebi subsequently initiated adjudication proceedings alleging that NDTV failed to make material disclosures required under LODR regulations regarding the alleged change in control.The regulator's investigation was triggered after a complaint filed in 2018 by a shareholder alleged violations of securities laws and non-disclosure of material information linked to the VCPL transaction.However, the adjudicating officer noted that a subsequent ruling by the Securities Appellate Tribunal in July 2022 fundamentally altered the legal basis of the case. The SAT had overturned Sebi 2018 order and held that the 2009 loan agreement did not amount to an acquisition of direct or indirect control over NDTV by VCPL.According to the SAT ruling cited in the order, the arrangement represented a commercial financing transaction that gave VCPL certain options but did not provide it with the power to manage or dictate the policies of NDTV.The adjudicating officer observed that the SAT's order remains operative because it has not been stayed by the Supreme Court, even though an appeal against the SAT ruling is pending before the apex court. "As a natural corollary, the decision of the Hon'ble SAT that there was no change in control pursuant to the 2009 Loan Agreement must guide the determination of the instant issue," the order said.The order further stated that disclosure obligations under the LODR regulations would arise only if there was a legally recognised change in control.Since the SAT had expressly ruled that no such change in control took place, the very basis for requiring disclosure no longer existed. The adjudicating officer also pointed to subsequent developments in the matter.VCPL eventually exercised its warrants in August 2022 and made an open offer in November 2022 at prevailing market prices. The order noted that the transaction ultimately proceeded as a prospective acquisition rather than the retrospective acquisition theory underlying SEBI's original 2018 order."The very foundation of the present proceedings has been effectively undermined and nullified by these subsequent events," the order stated.As a result, SEBI concluded that NDTV had not violated regulations requiring listed entities to disclose significant litigation, regulatory actions or events having a material impact on investors.The adjudicating officer therefore disposed of the proceedings against NDTV without imposing any monetary penalty. The case has been one of the longest-running regulatory disputes involving NDTV and traces its origins to financing arrangements entered into by the broadcaster's promoters more than 15 years ago.Read More News on(What's moving Sensex and Nifty Track latest market news, stock tips, Budget 2025, Share Market on Budget 2025 and expert advice, on ETMarkets. 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