Red FM, one of the top three private FM operations in the country, is no more a part of the India Today Group as of January 3, 2006. Red FM has been sold to a consortium of business groups comprising NDTV News, Malaysia-based Astro, and Value Labs. Early Wednesday morning, editors in the India Today Group were informed of this development.
Associate companies of Value Labs and Astro, through their existing Indian joint ventures, have come together with NDTV News (subsidiary of NDTV) to acquire Radio Today (Mumbai) Broadcasting Ltd, Radio Today (Delhi) Broadcasting Ltd and Radio Today (Kolkata) Broadcasting Ltd from the Living Media (India Today) Group. The three radio companies hold licences for FM radio broadcasting in Mumbai, Delhi and Kolkata, respectively, under the brand name of Red FM.
Significantly, around the middle of last year, the Prannoy Roy-promoted NDTV Ltd joined hands with Astro Broadcast Corporation of Malaysia to run 24-hour television channels across markets in South-East Asia. NDTV holds 20 per cent equity and Astro the rest in the joint venture. This information was given to the Bombay Stock Exchange by NDTV. The joint venture initially aimed to do business in Indonesia and Malaysia.
Value Labs is a Hyderabad based global IT service provider with extensive experience in telecom and multimedia application development. NDTV currently broadcasts three news and current affairs channels – NDTV 24x7, NDTV India and NDTV Profit. Astro is a leading media player in Malaysia and South East Asia.
Arjun Rao, Founder-Promoter and CEO of Value Labs, said, “We’re very excited with the opportunity to expand into the radio sector in India and we hope to build upon our global experience in the multimedia space. The possibilities that exist in relation to creating an interactive eco-system across radio, television, Internet and mobile is something we’re looking forward to.”
Narayan Rao, Director, NDTV, commented, “We’ve been planning to enter into radio for some time now. We’re very excited about it, especially with the option of migrating to Phase II without the old fixed licence regime. We see a lot of cross-media synergies by entering the space.”
Ambit Corporate Finance Pte Ltd. was the financial advisor to the transaction. Amarchand & Mangaldas and Suresh A Shroff were the legal advisors to the deal, according to a press statement issued by NDTV.