NEW DELHI: Media Content Communications Services (MCCS) India, the holding company for the Star News venture in India, proposes to have a paid-up capital of Rs 625 million, according to the application submitted to the government today for necessary approvals.
The authorised share capital of the joint venture between the Aveek Sarkar family-controlled ABP Pvt Ltd and Star Group Pvt Ltd, the application states, would be Rs 700 million, while the current paid-up capital is Rs 100,000.
MCCS is the company that would uplink and look after the affairs of Star News from India wherein ABP holds 74 per cent equity stake and Star has a 26 per cent shareholding. The former shareholders of MCCS, including ad man Suhel Seth and Balaji Telefilms chairman and actor Jeetendra, were bought out by ABP.
A senior information and broadcasting ministry official said that the government does not foresee any apparent problems with the new structuring of MCCS. "The structure that we had objected to, has been dismantled. It now looks like a far more real company (than before)," the official added.
So, in effect, it would mean that ABP would be coughing up slightly less than Rs 500 million at the moment, which has been calculated at the rate of 74 per cent of Rs 620.5 million.
This figure is contrary to the figure of Rs 750 million that the media had been reporting, basing most of their observations on an authoritative report filed by a business newspaper two days before the final agreement was signed in Mumbai between Star India CEO Peter Mukerjea and ABP's Aveek Sarkar last Friday.
A Star source told indiantelevision.com that in the coming months the investments would be ramped up and the paid-up capital is in consonance with the valuation of the company.
Meanwhile, Sarkar would be the chairman of the restructured MCCS that would have an eight-member board. The other members will include Aveek's brother Arup Sarkar, ABP's CEO A Lahiri, Star India CEO Peter Mukerjea, Star India CFO G Subramaniam, senior journalist and former editor of The Statesman and The Indian Express S Nihal Singh, Naresh Chandra and one yet-to-be nominated member.
However it is not clear whether the last three, including a yet-to-be-nominated person, are representatives of ABP Pvt Ltd or independent board members. Still, industry sources pointed out that the last three people are likely to be ABP nominees considering the board representation would have to be in the ratio of 6:2 as per the shareholding pattern.
MCCS filed its application for government approvals today afresh after the restructuring, including one with the Foreign Investment Promotion Board for bringing in foreign direct investment of 26 per cent from the Star Group. There are no FII, NRI or overseas corporate body (OCB) investments in the MCCS at the moment, the application states.
A government official pointed out that it may not be possible to get the whole process cleared within the deadline of 28 September as various clearances, including police verifications for new board members of MCCS, were needed. "I don't think so (that the I&B ministry would be able to clear the application by Sunday)," the government official said to a pointed question on the time likely to be taken for processing the Star News application. He added, "But we don't expect any real problem with the new application."
So, Star News, the brand name that has been leased out to MCCS for an undisclosed amount, would continue to be on air with its motto of keeping the viewers' needs and choices ahead ('Aap ko rakhe aage').
Having got the controversies behind it - and permanently too - it now needs to be seen whether the news channel can give the leader Aaj Tak, from The India Group, a real run for its money.