MUMBAI: During a period when big-time mergers and acquisitions are popping out of the cupboard while others are being fine-tuned, Zee Entertainment Enterprises Ltd (ZEEL) is not willing to confirm or deny that it’s buying Reliance Broadcast’s businesses. At least, for now.
In response to a news report appearing in a business daily on 13 October, ZEEL gave a non-committal response to Bombay Stock Exchange (BSE) yesterday. The company statement said, “We, Zee Entertainment Enterprises Limited, wish to clarify that the said report/article is only a media speculation. As a company, we keep exploring options from time to time and will inform the Exchanges, media and shareholders, if, and as and when, any such decision(s) are reached.”
The clarification given to BSE is purely non-committal corporate-speak as Zee neither denied the news report, nor confirmed it.
However, the business daily report on 13 October, 2016 emphasised that “it was done deal” and went ahead to even state that the deal was worth around Rs 18,720 million for the radio and television business owned by Reliance.
The ZEEL share, which closed on the BSE at Rs. 546.55 on Oct 13, opened the next day at Rs.550.75 to close lower at R. 528.50 on 14 October, 2016.
Speculation about the Subhash Chandra-led ZEEL buying Anil Ambani-owned Reliance Broadcast Networks Ltd (RBNL) has been making rounds of financial markets and journalistic circles for some time now. Media reports had earlier stated that the ZEEL-RBNL deal has been a case of on-now-off-tomorrow.
Indiantelevision.com, while reporting on the issue on 5 October, 2016, had sought clarification from ZEEL spokesperson who had then stated, “From time to time, we keep exploring strategic opportunities for entering new businesses or in our existing businesses. However, as a matter of policy, we do not comment on media speculation.”
The corporate response to media queries from Zee has been similar even when deals --- TEN Sports sale to Sony Pictures Network India, for example --- were confirmed later and formally announced. When speculation about Siti Cable buying DEN Networks gathered steam, a similar line was thrown. Ditto was the response with Dish TV’s ongoing discussions to acquire Videocon d2h from the debt-laden-and struggling Videocon group.
Acquiring RBNL businesses, which include Bhojpuri language channel BIG Ganga, a comedy-centric BIG Magic and a successful FM radio business, can certainly add to Zee’s portfolio of entertainment verticals.
Overall, the media industry may be ripe for consolidation; especially at a time when the regulator too is trying to bring about more order and transparency in the Indian broadcast sector via its draft guidelines.
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