RIL to fund Network 18 promoters, divest in Eenadu channels

Mukesh Ambani-led corporate giant would sell a part of its interest in Eenadu TV channels and would also fund rights issues of Network 18 firms

PTI | January 4, 2012



Reliance Industries and Network 18 group on Tuesday joined hands for a multi-layered deal worth about Rs 4,000 crore, under which the Mukesh Ambani-led corporate giant would sell a part of its interest in Eenadu TV channels and would also fund rights issues of Network 18 firms.

As part of the deal, Network 18 and TV18 Broadcast would together raise a net amount of Rs 4,000 crore through rights issues (wherein shares are issued to existing shareholders), including about Rs 1,700 crore contribution of promoters.

An independent trust set up by RIL would provide funds to the Network 18 group promoters, in the form of 'optionally convertible debentures', for rights issues.

TV18 would spend up to Rs 2,100 crore for acquiring a part of RIL's stake in ETV assets.

The deal also involves RIL's broadband venture Infotel getting preferential access to the content and distribution assets of Network 18 group, whose properties include business channel CNBC-TV18, English news channel CNN-IBN, alongwith various other channels and websites.

RIL said that its investments in various Eenadu TV assets total Rs 2,600 crore.

RIL holds 100 per cent stake in Eenadu's four regional news channels (ETV Uttar Pradesh, ETV Madhya Pradesh, ETV Bihar, ETV Urdu), 100 per cent stake in five entertainment channels (ETV Marathi, ETV Kannada, ETV Bangla, ETV Gujarati and ETV Oria), and 49 per cent in two Telugu channels (ETV Telugu and ETV Telugu News).

TV18 is acquiring 100 per cent stake in regional news channels, 50 per cent in non-Telugu entertainment channels and 24.5 per cent interest in two Telugu channels.

TV18 would get the board and management control of the ETV news channels and ETV non-Telugu entertainment channels.

However, RIL funding would not alter promoter, management or editorial control of Network 18 entities, the two groups said.

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