Zee Media Abandons Acquisition Of Reliance’s FM Business Due To Delays In Government Approvals

The deal between Zee Media Corporation Ltd (ZMCL) and Anil Ambani-owned Reliance Broadcast Network Ltd (RBNL) to purchase the latter’s FM radio business has been called off by ZMCL citing stalled progress due to a delay in clearance from the Ministry of Information and Broadcasting (MIB) and the Ministry of Home Affairs (MHA), reports Television Post.

The two companies had signed a tentative agreement in November 2016, as per which ZMCL would acquire a 49 per cent stake in RBNL’s FM radio business, with a call option to buy the remaining 51 per cent after a three year lock-in period.

“Well you can say technically it is called off because there is no progress,” ZMCL MD Ashok Venkatramani said during a recent earnings call. He explained that the period for which the initial Memorandum of Understanding (MOU) had been entered to had been exceeded by the wait for clearances from the MIB and the MHA.

As part of the agreement, ZMCL was to transfer 45 operational and 14 new and non-operational licences to newly created special purpose vehicles (SPVs) in which ZMCL would acquire a 49 per cent stake.

Zee news CFO Sumit Kapoor denied speculation that the company would be expanding with new channels in South India, stating that the company plans to invest Rs 20-25 crores in a creating a technology platform.