News Corp Stalls Chandra'S Fund Raising Drive

Rupert Murdoch's News Corp has rejected a request by Subash Chandra seeking permission to divulge financial details of two joint ventures whose assets were to be consolidated as a prelude for raising funds in the US.

Chandra plans to consolidate all his group company assets into a holding company on the strength of which he expects to raise funds.

Chandra and Murdoch have two joint ventures, Asia Today, the Hong Kong-based company that has leased the transponders for the Zee family of channels, and SitiCable, a cable network present in over 40 cities.

Chandra and his associates and News Corp have a 50 per cent equity each in Asia Today and SitiCable.

 

Murdoch and Chandra are bound by a secrecy clause under which neither can divulge details of the two companies without the other's permission.

Sources said Chandra's request was rejected because the money he plans to raise is for his satellite telephony project and not for the satellite electronic media. Under the agreement, financial details that need to be disclosed under US laws cannot be divulged without permission of the shareholders as they are private companies.

Zee Network chief executive, Vijay Jindal, and Subhash Chandra were unavailable for comment.

Subash Chandra is planning to invest $850 million to set up a mobile satellite telephony project. The Afro-Asian Satellite Communications, a Chandra-promoted company, has roped in VSNL and the Essar group to take up stake in the project.

Hughes Electronics, which would have built the satellite for mobile satellite telephony project, was also ready to pick up equity in the company.

However, Hughes was replaced by Lockheed Martin which will hold 14 per cent in the company. OCB and NRIs will hold another 35 per cent and the rest will be held by Indians, including VSNL and the Essar group. The total equity capital is around $300 million with foreign equity of around $124 million.

FIPB recently gave permission to Afro-Asian Satellite Communications, allowing the company to own a private satellite from India. Targetting the satphone market, ASC has ambitious plans to bring mobile satellite telephony to India via two satellites which were initially slated to be launched by 1998.

ASC's has plans to put in orbit a geo-stationary satellite over Gibraltar. An application for six orbital slots has been made_ two slots each over Africa, Central Asia and East Asia. However Chandra has been scouting for various sources to fund this ambitious project.