Mukesh Ambani-owned Reliance Industries Ltd (RIL) is acquiring a majority stake in Raghav Bahl’s Network18 Media and Investments and its subsidiary TV18 Broadcast through Independent Media Trust (IMT), of which RIL is a sole beneficiary.
Network18 Media and TV18 control a suite of broadcasting channels like CNBC-TV18, Viacom18 and CNN-IBN, besides a bevy of e-commerce businesses and digital internet sites.
The RIL board on 29th May approved funding of up to Rs 4,000 crore to IMT, which will use the funds to acquire a 78 per cent stake in Network18, a nine per cent stake in TV18 and shares tendered in an open offer to be made for public shareholders’ equity stake in Network18, TV18 and Infomedia Press Ltd (the publishing arm of Network18).
The acquisition was in the works for long. Its seeds are said to have been two years ago, when RIL, through IMT, gave a Rs 1,700-crore loan to Raghav Bahl’s investment companies to ensure he retained stakes in Network18 and TV18. The companies had decided to go for an open offer to raise Rs 4,000 crore for retiring debt and buying stakes in regional channels of the Hyderabad-based Eenadu Network. To maintain promoter stake in the company, Bahl needed Rs 1,700 crore, which he got from IMT in the form of optionally-convertible debentures.