Times group's Radio Mirchi has got the government's approval for purchase of four FM stations of rival Oye FM of TV Today group, but the buyout of three other stations in Delhi, Mumbai and Kolkata has been rejected.
The Ministry of Information and Broadcasting (MIB) has granted permission to Entertainment Network India Ltd (ENIL), which runs Radio Mirchi, to buy Oye FM's stations at Amritsar, Jodhpur, Patiala and Shimla.
The deal would further bolster Radio Mirchi's leadership position in the fast-growing FM radio market. It is already present in the key cities of Delhi, Mumbai and Kolkata, a reason cited by the Ministry for rejecting its proposed buyout of these three key stations of Oye FM.
TV Today group has been trying to sell its FM stations for a long time, but the deal had got stuck due to regulatory approvals.
Incidentally, 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'.
TV Today group runs seven Oye FM stations - in Mumbai, Delhi, Kolkata, Amritsar, Jodhpur, Patiala and Shimla.
This would be the second major deal in the FM radio space in recent past after leading media group Jagran Prakashan announced in December, 2014 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.
Radio Mirchi is operated by 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.
"The company has now received MIB's approval to purchase TV Today's four radio stations i.E. Radio business in Amritsar, Jodhpur, Patiala and Shimla," ENIL said in a filing to the BSE.
"The said purchase shall be subject to fulfillment of conditions specified by the MIB, execution of relevant documents with TV Today Network and completion of all other relevant formalities," ENIL added.
In a separate filing, TV Today said "the sale of radio stations at Delhi, Mumbai and Kolkata has not been approved since ENIL can't hold more than one radio license in a particular city."
In February, ENIL had said that the company has entered into an agreement to buy seven 'Oye FM' radio stations.
However, MIB had denied the permission on the grounds that the proposed sale was not in conformity with FM Radio guidelines. The decision of MIB was challenged by ENIL in a writ petition filing in a court.
ENIL shares today settled 12.13 per cent up at Rs 815.05 apiece on the BSE.
