Anil Ambani may sell Reliance Broadcast Network (RBN), which operates BIG FM radio channels, to Jagran Prakashan, the publisher of Hindi newspaper Dainik Jagran, suggested media report. Jagran Prakashan has offered to pay around Rs 1,200 crore for this deal, the Economic Times quoted a people with direct knowledge of the matter as saying.
Reliance Broadcast Network is part of the Reliance Anil Dhirubhai Ambani Group which operates Big FM Radio stations and BIG Magic television channel in India.
According to the leading daily, the latest offer came after the Anil Ambani's group entity failed to secure a deal with Subhash Chandra-led Zee Group amid government approval delays. The Jagran Prakashan will acquire RBN through Music Broadcast Ltd (MBL).
Mahendra Mohan Gupta-led Jagran Prakashan acquired Music Broadcast Ltd (MBL), which owns Radio City, in an all-cash deal in December 2014.
"RBN and MBL have reached an agreement... MBL will first pick up 24 per cent in RBN, which does not require any permission," the financial daily quoted one of the sources as saying.
As per government norms, a radio company cannot sell the majority stake in a new licence for three years. The lock-in period for Big FM's 45 stations expired on March 31 last year, while that for the remaining 14 will perish in March 2020, it added.
If the deal finalises, it would provide major relief to Anil Ambani-controlled Reliance Group which aims to reduce its overall debt by Rs 10,000-12000 crore through stake sale and monetisation of several non-core investments. Reliance Capital has a debt of Rs 18,000 crore.
The company aims to reduce 50-60 per cent of its debt by monetisation of its 43 per cent stake in Reliance Nippon Life Asset Management and 49 per cent stake in Reliance General Insurance Company, along with several non-core investments.
Reliance Capital, the financial services arm of ADAG group, will sell its entire 42.88 per cent stake in Reliance Nippon Life Asset Management Ltd (RNAM) to its partner, Nippon Life Insurance Co. Ltd, in order to pare debt. The company is expected to raise Rs 6,000 crore through this transaction which will be used to reduce its outstanding debt.
It has also planned to monetise 49 per cent stake in Reliance General Insurance Company through public listing of its shares for which it is awaiting Securities and Exchange Board of India (Sebi's) approval.
Reliance Capital is also in process to monetise its several non-core investments, which include a strategic stake sale in Prime Focus and other media assets.
Edited by Chitranjan Kumar