Radio City Board okays acquisition of Big FM; combined entity to have 79 stations
The Board of Directors of Music Broadcast Limited (MBL) has approved the acquisition of Reliance Broadcast Network Limited (RBNL), a Reliance ADA Group company. RBNL houses 92.7 Big FM, one of India’s largest radio networks with 58 stations, which reaches out to 1,200+ towns and 50,000+ villages and over 30 crore Indians across the country.
Music Broadcast Limited currently has 39 stations under Radio City and was the first ever FM network in the country. The combined network will have 79 stations, making it the largest radio network in India.
Subject to entering into definitive binding agreements, Radio City will initially acquire 24 per cent equity stake of RBNL, the terms of which are being finalised, by way of a preferential allotment for total consideration of Rs 202 crore. Further, on receipt of all regulatory approvals, MBL will acquire the entire stake held by the promoters of RBNL basis an enterprise value of Rs 1,050 crore after making adjustments for variations, if any, on the basis of audited accounts for the year ended March 31, 2019.
The entire transaction is expected to close in the first quarter of FY2021.
EY India is acting as the Investment Banker to the transaction. PricewaterhouseCoopers is acting as financial and tax due diligence and Khaitan & Co are acting as the legal advisors to MBL. ICICI Securities is acting as financial advisor to MBL.