Sun TV to merge group companies Gemini TV and Udaya TV

Sun TV Ltd has announced that the Board of Directors of the Company has in principle approved the scheme of arrangement viz., Amalgamation of Gemini TV Pvt Ltd with the Company, and Merger of All Divisions of Udaya TV Pvt Ltd, except the FM Radio Division of Udaya TV Pvt Ltd with the Company. The Board of Directors has appointed M/s Enam Financial Consultants Pvt Ltd and M/s DSP Merrill Lynch Ltd as advisors.

Gemini TV Pvt Ltd, owns five television channels, Gemini TV, Teja TV, Gemini News, Gemini Music and Gemini Cable Vision, and is operating with a revenue of Rs 17,469 lakhs for the year ended March 31, 2006. Gemini TV is the No. 1 Telugu Channel in the Country for the past several years (Source: TAM).

Udaya TV Pvt Ltd, owns four television channels, Udaya TV, Udaya Movies, Udaya Varthegalu and Udaya TV II, and is operating with a revenue of Rs 9,431 lakhs for the year ended March 31, 2006 Udaya TV is the No. 1 Kannada channel in the Country for the past several years (Source: TAM).

Mr Kalanithi Maran, Chairman & Managing Director of the Company says that "With this proposed merger Sun TV shareholders should benefit immensely from the highly profitable operations and strong growth plans of both Gemini TV Pvt Ltd and Udaya TV Pvt Ltd. Sun TV Ltd will have an integrated growth strategy for all south Indian language channels, and thus build a dominant presence in entire south India."

The Company currently operates four television channels - Sun TV, KTV, Sun News and Sun Music - in Tamil language and two television channels - Surya TV and Kiran TV - in Malayalam language, and three FM Radio Stations, and another three FM Radio Stations through its subsidiaries. The two subsidiaries of the Company, viz., Kal Radio Ltd and South Asia FM Ltd, jointly holds 41 FM Radio Licences for FM Radio Stations across India.

With this proposed merger the Company, will become one of the largest television broadcasters in India.

Source : Equity Bulls

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