To expand its presence in FM broadcasting space, leading player Radio Mirchi has inked a pact to acquire the seven 'Oye FM' radio stations run by the TV Today Network.
In separate announcements, the two entities said they have entered into a "non-binding memorandum of understanding" for the proposed deal, but did not disclose financial details.
'Radio Mirchi' is operated by Entertainment Networks India Ltd (ENIL), which is promoted by Bennett, Coleman & Co Ltd and is part of the diversified media group comprising of leading dailies like Times of India, Economic Times and Navbharat Times, as also TV channels including Times Now and ET Now.
'Oye 104.8 FM' is also run by a leading media group, India Today Group, which publishes a number of magazines as also Mail Today daily, while its TV channels include Aaj Tak and Headlines Today.
The group runs seven Oye FM stations -- in Mumbai, Delhi, Kolkata, Amritsar, Jodhpur, Patiala and Shimla.
On the other hand, Radio Mirchi is present in at least 32 cities including in Mumbai, Delhi and Kolkata. The proposed deal would also expand its presence to cities like Amritsar, Jodhpur, Patiala and Shimla.
This comes at a time when the government has initiated a process for auction of the third phase of FM radio frequency, which was stuck for over three years.
Besides, this is the second time that TV Today group is selling its FM radio assets. In 2006, it sold its 'Red FM' business to NDTV group, after which it re-entered the business with 'Meow FM' channel and later re-branded it as 'Oye'.
Earlier on February 6, TV Today Network's board of directors had approved the sale of its radio FM business, OYE! 104.8 FM, and has authorised a committee of directors/senior officials to negotiate the terms and conditions with potential buyers.
Separately, ENIL's board on February 10 approved the constitution of a committee of directors "to explore, negotiate and conclude M&A opportunities in the FM broadcasting space".
This committee today noted that the company has entered into a non-binding MoU with TV Today Network in relation to the proposed purchase of seven radio stations.
This is subject to fulfilment of contractual obligations and receipt of all necessary regulatory approvals including permissions from the Ministry of Information and Broadcasting.
Separately, a committee of senior officials of TV Today also held a meeting today with regard to the non-binding MoU with ENIL for this proposed deal.
This would be the second major deal in the FM radio space in recent months after leading media group Jagran Prakashan announced in December the acquisition of Music Broadcast Pvt Ltd, which operates the popular Radio City FM stations.
Radio City operates 20 FM stations in seven states. It has presence in metros as Delhi, Mumbai, Bengaluru and Lucknow and has a listener base of 10.8 million.
The Cabinet cleared the auction of third phase of FM radio waves last month, under which FM frequencies worth Rs 550 crore could be sold.
The Cabinet had also approved migration or renewal of private FM Radio licences from Phase-II to Phase-III in 69 existing cities for 135 channels on payment of migration fee.
The first phase was auctioned in 1999-200, while the second phase happened in 2005-06. There are 243 private FM channels in operation in 86 cities of the country.
The third-phase auction will provide more channels to listeners with richer content in 69 existing cities.
