The Competition Commission of India (CCI) has given the green signal to Reliance Industries' acquisition of stake in the Raghav Bahl-promoted media firms Network 18 and TV18 Broadcast.
In January, Mukesh Ambani-owned Reliance Industries had announced a major diversification into the media and entertainment sector through the Network18 buy. RIL had routed its investment through the Independent Media Trust that was to subscribe to the zero coupon optionally convertible debentures (OCDs) issued by the holding company of the Network18 Group.
The money was to be used by the promoters of the media firm to invest in the rights issues of its two listed companies. Network18 runs the portal moneycontrol.com while TV18 operates several business and general news channels including CNBC TV18 and CNN IBN. RIL had said it would invest about Rs 1,700 crore in the Network18 group.
Network18 eyes Eenadu
TV18 and Network18, the two listed companies of the group, will use this investment along with capital from other investors to retire debt and buy out a large part of RIL's stake in Eenadu, the regional language news and entertainment business run by Ramoji Rao, the Hyderabad-based media industry veteran.
TV18 and Network18 plans to raise Rs 2,700 crore each through two separate rights issues. TV18 had said it will raise money at up to Rs 40 a share, while Network18, which is the holding company of TV18, will raise it at up to Rs 60 a share. The net amount to be raised is about Rs 4,000 crore.
CCI said that the proposed combination is unlikely to give rise to any competition in the country. The anti-monopoly watchdog said that it had carried out the competitive impact of the proposal to ascertain whether both groups are engaged in production, supply, distribution, storage, sale or trade of similar or identical or substitutable goods or services.
bindu.menon@thehindu.co.in