Foraying into radio business, leading media group Jagran Prakashan (JPL) on Tuesday announced acquisition of Music Broadcast Pvt Ltd, which operates the popular Radio City FM stations.
Jagran Prakashan, which runs leading Hindi daily Dainik Jagran , said the all-cash acquisition of Music Broadcast Pvt Ltd (MBPL), which had a turnover of Rs 161.8 crore last fiscal, is expected to provide strong return on its investment.
However, the exact deal size could not be ascertained.
Commenting on the development, Jagran Prakashan CMD Mahendra Mohan Gupta said: “This deal will catapult JPL into a leadership position in the radio industry and enable the company to benefit from the rapid growth in radio advertising.
Acquisition of Radio City further consolidates our position as India’s leading media and communications group.”
Radio business will complement JPL print, outdoor activation and digital business and enable deeper inroads with advertisers both at national and local level, he said.
“The radio business has witnessed significant growth in recent past and is expected to grow at more than 18 per cent CAGR in the coming years,” Mr. Gupta said.
The acquisition will be funded through internal accruals and investments and will be an all cash deal, JPL said.
Apart from Dainik Jagran , the group’s publications include Midday , Naiduniya , I-Next , City Plus and Punjabi Jagran .
Radio City operates 20 FM stations in seven states. It has presence in cities such as Delhi, Mumbai, Chennai, Bengaluru and Lucknow and has a listener base of 10.8 million.
Music Broadcast had a revenue base of Rs 161.8 crore in 2013-14 with 28 per cent growth in ad revenue.
In a filing to the BSE, Jagran Prakashan (JPL) said, “The Board of Directors of the company at its meeting held on December 16, 2014, approved the entry of the company into the radio industry via acquisition of Music Broadcast Private Limited (MBPL).”
“The acquisition is subject to regulatory approvals, including from Ministry of Information and Broadcasting, and execution of binding agreements. As part of the acquisition, the Company is acquiring MBPL’s holding Company and fellow subsidiary that provides activations,” the filing said.
As part of the acquisition, the company is acquiring MBPL’s holding company and fellow subsidiary that provides activations, it added.
Shares of Jagran Prakashan on Tuesday closed at Rs 140 on the BSE, down 1.20 per cent from previous close.
