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TV Today to acquire Radio Today; Group sees the move as growth driver

02-August-2007
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TV Today to acquire Radio Today; Group sees the move as growth driver

The India Today Group is in the process of transferring the group’s radio business, Radio Today Broadcasting Ltd from Living Media India Ltd (LMI) to TV Today Network Ltd (TVTN). TVTN has been a 10 per cent shareholder in Radio Today at the time of its launch. With this, TVTN completely acquires the radio business. Aroon Purie, Founder and Editor-in-Chief of the Group, explained, “At the time when Radio Today Broadcasting Ltd was promoted by LMI, TVTN was made a 10 per cent shareholder. This was necessary to comply with the regulatory issues in the event TVTN chose to acquire the entire business as an existing shareholder.”

“Since LMI owns 56 per cent share in TVTN, the ultimate criteria of the promoter owning 51 per cent share in radio business remains intact in compliance of the guidelines,” he further said.

Speaking more on the rationale behind the move, Purie said, “The radio company has, at present, licenses for seven circles, including three metros – Delhi, Mumbai and Kolkata. This will help in creating value offerings across platforms for the advertiser. This is a unique bundling that will be of tremendous value to retail advertisers. This acquisition can be a significant growth driver as the retail advertiser base is increasing at a higher rate than the corporate advertiser, and no other media play will have the advantage of bundling local channels with local radio stations. Besides, there is tremendous potential for content synergy when news will be allowed on FM stations.”

The move has led to some market conjectures already, one of the first being that this move would add to TV Today’s valuation, and that this could even lead to tempting offers from suitors. The Group does have a precedent when Red FM was sold, and the radio businesses were started afresh in the second phase of FM radio. However, Purie quells these speculations, stating, “It has never been TV Today’s intention to be a seller. We are only buyers in this business.”

Yet another speculation was on the group’s intention to launch an English business news channel. However, G Krishnan, CEO, TVTN informed, “Currently there are no plans to launch a business channel.”

Krishnan though is looking forward to the transfer. He said, “The Board has recently approved the decision for TV Today to acquire the radio business. The transfer is yet to happen. However, I see a developing synergy between television and the radio business. Currently, there would be an opportunity to bundle the platforms for the retail advertiser in markets like Delhi. Eventually, when news is allowed on FM radio, there will be scope for content synergy.”

Adding more on TV Today's future expansion plans, Krishnan said, “Currently, we are in the process of consolidating our existing bouquet. Headlines Today has emerged with some interesting and innovative content and the viewership is showing an upward trend. Tez is the only differentiated news channel. Dilli Aaj Tak is our first step in building a strong product in the regional space. In the near future, we will definitely look at identifying profitable niches and creating quality products to service the space.”

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