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Yes Bank Ltd acquired a 24.19% stake in direct-to-home service provider, Dish TV India Ltd, by invoking pledges against 44.53 equity shares kept as collateral with the private lender for a loan.

This is the fifth instance in the past one year that Yes Bank has acquired majority stake in a non-banking businesses simply due to invocation of pledge against shares of a company that had availed loans from the bank and later failed to repay the dues.

On 15 January, Yes Bank, by virtue of invocation of pledged shares, had acquired six million equity shares, constituting about 10.25%, of Sical Logistics Ltd, a promoter group entity of Coffee Day Enterprises Ltd, founded by late VG Siddhartha.

Sical Logistics provides dredging and retail supply chain. Sical Connect Ltd had defaulted in repayment of a loan it took from Yes Bank by pledging shares of Sical Logistics.

Similarly, on 14 January, the lender had acquired 127.32 million shares, or 29.97% stake, of Rosa Power Supply Company Ltd, a wholly owned subsidiary of Reliance Power Ltd.

On 18 November, 2019, the bank acquired 0.95 million shares constituting 20.61% of Tulip Star Hotels Ltd by invoking a pledge. Tulip Star Hotels owned 50% stake in V Hotels Ltd, which in turn operates prime hotel property in Juhu, Mumbai. The pledge was invoked because Ezeego One Travel and Tours Ltd had defaulted in a loan repayment.

Last year on 26 July, Yes Bank had acquired 32.75 million shares, or 18.55%, of Cox & Kings Ltd, and 34,080 shares amounting to 30% of Ezeego One Travel & Tours Ltd.

"Shares have been acquired pursuant to invocation of pledge of the shares subsequent to default/breach of terms of credit facilities sanctioned by Yes Bank to Essel Business Excellence Services Ltd, Essel Corporate Resources Private Ltd, Living Entertainment Enterprises Private Ltd, Last Mile Online Ltd, Pan India Network Infravest Ltd, RPW Projects Private Ltd, Mumbai WTR Private Ltd & Pan India Infraprojects Private Ltd," the bank said.

Since the start of the year, Dish TV shares have lost 67% of its value to close at 4.28 apiece on Friday.

Launched in 2003, Dish TV was started with the aim to provide services in rural areas and regions not serviced by cable television.

In 2016, its board had agreed to an all-stock merger with Videocon d2h, which was completed in 2018. Dish TV has a market capitalisation of Rs. 2,046 crore and a subscriber base of 23.94 million, making it a close rival of Tata Sky, as per a Mint report.

According to data from the Telecom Regulatory Authority of India (Trai), the DTH market in the country is dominated by Dish TV (40%), followed by Tata Sky (25%) and Airtel TV (22%).

In 2019, Dish TV had forayed into the online video-on-demand segment by launching OTT (over-the-top) platform, Watcho.

Dish TV was in the news earlier this year when its deal with Sunil Mittal-led Bharti Airtel Ltd had fallen through. Media reports said promoters of Dish TV were in talks with a global financial investor, which has no operations in India, to pick up half their stake.

ABOUT THE AUTHOR
Anirudh Laskar
Anirudh Laskar is a senior editor at Mint, with 17 years of experience. He has reported on significant corporate matters including large mergers and acquisitions, India's emerging e-commerce sector and regulatory issues in the financial services industry. Based out of Mint’s Mumbai bureau, Anirudh has worked with Business Standard and The Telegraph before joining Mint in 2009.
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