Anil Ambani owned Reliance Capital and Reliance Land is set to sell their entire stake in Reliance Broadcast Network (RBNL) to Jagaran Prakashan-owned Music Broadcast (MBL). Under the name of Big FM Radio, RBNL operates around 58 radio stations across the country. On the other hand, MBL operates 39 stations of Radio City currently.
Amit Bapna, CFO, Reliance Capital, said: “Together with the stake sale in Reliance Nippon Asset Management for Rs 6,000 crore and other ongoing monetization plans, we expect Reliance Capital’s debt to reduce by around Rs 12,000 crore (nearly 70 per cent) in FY20.”
According to the reports, initially, MBL will acquire a 24 percent equity stake of RBNL for a total of Rs 202 crore. The remaining stake in RBNL which is now held by Reliance Capital and Reliance Land for Rs 1,050 crore will be acquired later by MBL. Out of the 58 stations operated by Big FM, 40 will be acquired by MBL, while the remaining 18 will be sold to other buyers.
According to the reports, the 18 stations are not included in the MBL deal as the stations of MBL overlaps with Big FM’s and the talks with the buyers are in the final stage. Reliance Capital is estimated to receive amount of Rs 150 crore for the stations that are not part of MBL deals. This will help the Reliance Capital group to reduce their debt by Rs 1,200 crore. The expected time for the completion of this agreement is by the first quarter of fiscal 2021.
In a press release MBL said that its board Monday approved the acquisition of RBNL. The combined network will have 79 radio stations making it the largest radio network in the country, MBL said in a release adding, “The entire transaction is expected to close in the first quarter of FY21.”
