 "J Jayalalithaa's close aide V K Sasikala (Photo: PTI)")
Sasikala, a confidante of former Tamil Nadu chief minister J Jayalalithaa, had bought a 75 per cent stake in Mavis Satcom, the company that runs Jaya TV network, when in a cell at Bengaluru’s Parapana Agrahara jail.
While the details of their custody are in public domain, Business Standard pieced together the acquisition from the company’s filings with the ministry of corporate affairs.
On September 27, 2014, a court in Bengaluru had sentenced Jayalalithaa and three associates — Sasikala, J Ilavarasi and V N Sudhakaran — to four years imprisonment in the Rs 66.65-crore disproportionate assets case. Ilavarasi is Sasikala’s sister-in-law and Sudhakaran her nephew. They were moved to the city’s Parappana Agrahara prison soon.
Four days later, on October 1, Mavis issued a notice for a board resolution to approve a transfer of shares.
On October 10, 2014, the board approved a transfer of 659,200 shares or 75.8 per cent to Sasikala from two directors, Venkatesh and Maruthappa Palanivelu. The Supreme Court granted bail to them on October 17.
An extract of the board minutes of October 10, 2014, signed by managing director Prabha Sivakumar, read: “The chairman informed the board that the share transfer form has been lodged by the members to the company for share transfer, along with revalidation of share transfer form. The board after due deliberation passed the following resolution: Resolved that the approval be and hereby given to the under noted transfers.”
Accordingly, Venkatesh, director since inception, transferred 219,400 shares. Palanivelu, who joined the board in 2006, transferred 439,900 shares. This took Sasikala’s holding to 701,260 or 80.76 per cent.
While the filings do not reveal the value of these deals, there are some clues in an earlier transaction, where Sasikala and a couple of other companies bought Mavis shares.
Sasikala did not own any shares at the end of the company’s annual general meeting in September 2013. Somewhere in 2013-14, she purchased 42,860 shares from three existing shareholders. She bought 26,789 from Indian Tropical Agro products, a company based in the port town of Tuticorin. Chandra Bhuppathi and D Gnanaraj sold her 10,714 and 5,357 shares, respectively.
During the same period, two companies associated with Sasikala and her relatives, Signet Exports and Hot Wheels Engineering (now Jazz Cinemas), also bought Mavis shares. While Hot Wheels bought 41,571 shares from 11 individuals, Signet bought a total of 37,499 shares. Sellers included Mumbai-based Candock Investments and S Vaikunda Rajan, a Tamil Nadu-based mining baron.
In Signet’s financial statements, these Mavis shares were valued at cost. The cost of the Signet holding was Rs 2.56 crore, valuing each Mavis Satcom share around Rs 683. At these prices, the value of Sasikala’s holding in Mavis comes to around Rs 48 crore.
To be sure, company law experts say there are no specific qualifications or qualities for a shareholder in companies that would bar a person in jail from becoming one.
However, the shareholding of companies running news channels is governed by the Ministry of Information and Broadcasting’s uplinking guidelines. Clause 3.1.4 says: “The company shall make full disclosure, at the time of application, of shareholders agreements, loan agreements and such other agreements that are finalised or are proposed to be entered into.”
Some media investors said the phrase “are proposed to be entered into” implied that any change in shareholding should be intimated to the ministry in advance.
These guidelines also provide that changes to shareholding should be intimated to the ministry within 15 days of such changes. Although Jaya TV started off as a general channel, it grew its network to include news a few years later. “On the 6th of December 2008, Jaya Network launched Jaya Plus – a 24 x 7 news and current affairs channel; Jaya Max – a musical channel; and J-Movies – a movie channel. These channels are available on most global cable networks,” the Jaya TV website said.
Last June, the Union home ministry had cited pending criminal investigations against the promoter to deny security clearance for radio stations and channels of Sun TV Network.
Apart from the legal issues, the transactions also raise the question if these moves were under instructions or knowledge of Jayalalithaa, who was also in jail then, could be politically significant as her long-term companion closes in on the reins of the party and the government.
Media vehicles have traditionally played a key role in Dravidian politics. Dravida Munnetra Kazhagam chief M Karunanidhi is fond of calling party mouthpiece ‘Murasoli’ his first child. After becoming active in the government, he left the editorial role to his nephew Maran, who came to be known as ‘Murasoli’ Maran. Maran’s son Kalanithi Maran launched Sun TV in 1993. Sun TV played its part in broadcasting visuals of assets seized from Jayalalithaa’s house after she lost power in 1996. Jaya TV was launched in 1999.
