Dish TV denied the news reports suggesting a sale of its majority stake to the leading telecom service provider Bharti Airtel. The D2H service provider clarified the same in a regulatory filing to the Bombay Stock Exchange.
In the response, it also stated that Dish TV India Limited does not have the required information to report under extant SEBI Regulation 30 that may impact the stock price of the company.
The report that originally suggested the same claimed that Airtel is looking to purchase a 5.93% stake from Dish TV’s promoter group and a 25.63% stake owned by Yes Bank Ltd. If the promoters and Yes Bank accept Airtel’s offer, Airtel will buy the share from other investors until it owns 51% of the company.
The report further stated that Airtel’s executives had conducted the preliminary talks with Dish TV parent company Essel Group’s founder Subhash Chandra and the consulting company EY presented due diligence of the matter on October 25 to Airtel. The report cited the source as three people ‘aware’ of the matter.
Dispute between Yes Bank and Dish TV
There is a longstanding dispute between Subhash Chandra-led company and its current majority stakeholder Yes Bank. Yes Bank acquired the share of Dish TV after it failed to repay the debt, and the bank invoked the pledged shares. In September 2020, Subhash Chandra filed a police complaint against Yes Bank accusing of fraud while brokering a merger transaction between Videocon D2H and Dish TV India. The matter is currently under investigation.
As a part of the ongoing investigation, the Crime Branch froze the voting rights on the stake of Yes Bank in Dish TV India. Yes Bank moved against the decision in Allahabad High Court, which dismissed the Bank’s plea stating that Court cannot interfere in the investigation. Yes Bank further approached the Supreme Court and received a favourable ruling that would allow Yes Bank to participate in the AGM of the Dish TV. Besides Yes Bank, other creditors, including IndusInd Bank, HDFC Ltd, L&T Finance, and Clix Capital, hold nearly 20% stake. Essel Group’s founder Subhash Chandra has only a 6% stake in the company.