Sri Adhikari Brothers Television Network Ltd (SAB TV Network), which is engaged in the production and distribution of content, is demerging its broadcasting and publication units into two separate listed firms, as per a stock market disclosure.
In a meeting held on August 28, 2014, the company’s board considered plans to realign the businesses with a view to unlock value in broadcasting allied business, create greater financing flexibility and offer investors an opportunity to benefit from sector-focused business entities, it said.
The broadcasting business is currently housed under a string of firms under TV Vision Ltd, a wholly owned subsidiary of SAB TV Network. The subsidiaries of TV Vision include UBJ Broadcasting Pvt Ltd, HHP Broadcasting Services Pvt Ltd and MPCR Broadcasting Services Pvt Ltd. These units will be consolidated into TV Vision, which would in turn become a listed entity.
The board has also approved the consolidation of publication business of the group under the company and the subsequent demerger of the publication business under Marvick Entertainment Pvt Ltd (to be changed to a public company) as a new listed firm.
"In the last few years, the company has strengthened its content business and ventured into broadcasting business by launching niche category TV channels and also forayed into allied business in the publication and event management, with focus on niche segment of the society. Foreseeing the change business would undergo with penetration of internet and government plans to unleash remote connectivity through digital platform, the company believes that it is the right time to venture into new age technology and create a level playing field in its business segments,” said Markand Adhikari, vice-chairman & MD of SAB TV Network."
As a result of restructuring process, the group would have two more listed entities in which, the existing shareholders would become shareholders in the same proportion to their holding in SAB TV Network.
The shareholders would receive one fully paid-up equity shares of Rs 10 each of the broadcasting business and three fully paid-up equity share of publication business as well for every fully paid-up equity share of Rs 10 each held in the company and 10,000 redeemable preference shares of Rs 10 each of the TV Vision to the preference shareholders of the company on a proportionate basis.
Additionally, the company would also issue 2,381,068 redeemable preference shares of Rs 10 each fully paid-up of the company to the equity shareholders of SAB Assets (which houses the publication unit) on a proportionate basis pursuant to the transfer of the publication business of SAB Assets, based on the net worth of SAB Assets as on March 31, 22014 and supported by report from an independent valuer.
Founded in 1995, SAB TV has been producing multi-lingual, multi-genre content, and already has an established regional presence in various Indian languages including Marathi, Gujarati, Tamil, Telugu and Kannada.
For the financial year ended in March 2014, SAB TV reported a net profit of Rs 4.8 crore, while its revenues were Rs 180.3 crore.
Shares of the company last traded at Rs 120.75 each, up 1.30 per cent on BSE in a strong Mumbai market on Thursday. The market is closed on Friday.
(Edited by Joby Puthuparampil Johnson)