Mumbai: Indian tycoon Anil Ambani is in talks to sell his FM radio broadcasting business to a local media conglomerate for Rs 12 billion ($173 million), people with direct knowledge of the matter said.
Ambani’s entertainment company Reliance Broadcast Network Ltd. plans to first sell a 24% stake to a unit of Jagran Prakashan Ltd. before a complete disposal in staggered transactions, the people said, asking not to be identified as the talks are confidential. The sale needs to be done in stages under Indian rules governing a radio broadcaster, they said. An announcement is expected as early as this week, according to the people.
The radio business is a unit of Reliance Capital Ltd., the Anil Ambani group’s financial services arm. Music Broadcast Ltd., a unit of Jagran, said in a statement Monday that no definitive document has been signed and the board proposes to consider the move later in the day. A representative for Reliance Capital didn’t immediately respond to a call seeking comments.
The planned exit from the radio business is part of efforts by Ambani, 59, to cut wider group liabilities after a debt-fueled expansion in the past decade strained finances, while a subsequent government crackdown on bad loans led to the collapse of his wireless phone-services unit. This will be the second sale in quick succession for Reliance Capital, Ambani’s final stronghold, which last week sold a stake in its asset management business to partner Nippon Life Insurance Co. for about $650 million.
Reliance Communications Ltd., the telecom operator controlled by Ambani, is facing insolvency proceedings, while his power, defense and infrastructure units have battled piling debt, bankruptcy cases and regulatory hurdles.
The Economic Times earlier reported on the impending Reliance Broadcast deal. –Bloomberg
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