FM radio biggies ENIL, RBNL eye acquisitions

As the government prepares to issue additional radio licences and announce new guidelines for the sector, leading FM channel operators such as Entertainment Network India Ltd (ENIL) and Reliance Broadcast Network Ltd (RBNL) are eying acquisitions.

Entertainment Network India Ltd (ENIL), which operates 32 radio stations under the Radio Mirchi FM channel across India, today said the company will consider acquiring other radio operations if government regulations are relaxed.

"We have a strong experience in building brands. If we feel that we can add value to an existing brand, we will consider the acquisition," ENIL executive director and CEO Prashant Panday told PTI.

"Apart from this, we are a very strong sales team. If there are synergies available for us to exploit, we will consider acquisitions," he added.

Panday said the FM Radio Phase-III expansion is expected to allow multiple frequencies in the same town. It is also likely to relax the lock-in period for radio promoters.

"If these two things happen, then there is certainly a chance that M&A activities may happen. ENIL will be keen to look at opportunities that emerge," he said.

As per the current policy, an FM licence is given for only ten years and a company cannot operate more than 15% of the total FM stations allocated.

Panday said: "All acquisitions, especially in radio, must be valued correctly and must fit into an overall strategic plan. If that happens, we will go ahead, else we'll build from scratch."

Similarly, Reliance Broadcast Network Ltd (RBNL), which owns Big FM, has said it will consider making acquisitions for its radio business provided future government guidelines for the sector are favourable.

"We will be open to M&A if it comes at a right price and if the guidelines allow us to do so," RBNL chief financial officer Asheesh Chatterjee said without giving details.

He said under the present circumstances, it made sense to bid for new licences rather than acquire an existing company whose licence is about to expire.

After much delay, the government is likely to announce the auction of additional licences for the Phase-III expansion of FM radio and other policy decisions related to the sector.