Reliance Jio's Hathway, Hinduja arm in race to acquire Siti Networks

Reliance Jio’s Hathway Digital and Hinduja Group’s IndusInd Media & Communications are among 14 resolution applicants that have shown interest in buying Siti Networks, a troubled Essel Group entity, said people close to the matter.

Hathway Digital and IndusInd Media & Communications did not wish to comment on the development. The 14 companies on the list of PRAs (potential resolution applicants) are expected to submit their resolution plans by January 17.
 

Siti Networks is a multi-system operator and wired broadband service provider with a network of more than 33,000 kilometres of optical fibre and coaxial cable. Its services are spread across 580 Indian locations and cover over 11.55 million digital viewers. “Acquisition of Siti Networks will boost the buyer’s inorganic growth expansion, especially given its strong presence in the eastern market. Its fibre optic business too has valuable assets to offer,” a senior advisor said.
 

On November 30, 2022, Siti Network issued a statement estimating its amount overdue to seven lenders at Rs 1,173 crore — including Rs 279 crore to Housing Finance Development Corporation, Rs 269 crore to Axis Bank, Rs 156 crore to IndusInd Bank, and Rs 147 crore to IDBI Bank. These lenders had provided the firm with term loans and working capital facilities with interest rates varying from 9 to 13 per cent. The fourth meeting of the CoCs of Siti Networks was held on December 15, 2023, the firm informed the stock exchanges. “During the meeting, the resolution professional presented and discussed with the CoC members, inter alia, CIRP-related updates viz CIRP timelines, claims, business operations, and resolution process update,” the firm said. 

Siti Network continued to incur losses in the first half of 2022-23 (H1FY23), and had a negative working capital and net worth as on September 30. On a consolidated basis, it booked a loss of Rs 145.4 crore on a revenue of Rs 683.9 crore in H1FY23. In FY22, it reported consolidated losses of Rs 260.9 crore on a revenue of Rs 1,460.8 crore.

The insolvency resolution professional (IRP), Rohit Mehra, took control and management of the company on August 16, 2023. “Currently, the powers of the board of directors of the company stand suspended and are being exercised by Rohit Mehra as the IRP of the company following the provisions of the code and related regulations,” the company informed the stock exchanges on September 7 last year.