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NEW
DELHI: HT Media Ltd (HTML) shareholders gave the company's
management the go-ahead to demerge the group's radio business
from its subsidiary - HT Music and Entertainment (HTME) yesterday
and merge it with itself.
HTME operates FM stations under the Fever 104 brand. The radio
station is a collaboration between HT Media and Virgin Radio.
Late
last year, the company's board had given it the approval to
merge Fever 104 with HTML, after demerging it from HTME. The
demerger was subject to necessary approvals and sanction of
the concerned authorities and Delhi High Court.
Says
a company source, "The shareholders' meeting took place
on 28 January wherein a majority of them have agreed to demerge
the radio business. Nevertheless, we will publish the final
outcome of the meeting on Friday, 30 January at 4 pm; post
which the chairperson of the company will send a report to
the Delhi High Court. The High Court will allot a hearing
date to us for the matter, after which the demerger will take
place."
Earlier,
the company had stated that the proposal was to write-off
part of the share capital of the demerged (HTME) company which
has been eroded due to accumulated losses and utilisation
of securities premium of resulting company (HTML) for the
said purpose and also to the demerger of the radio business
of HTME and transfer vesting thereof into the resulting company.
"The
radio business of the demerged company has incurred substantial
losses since inception on account of low ad revenue, high
brand building cost, and delay in availability of common infrastructure
resulting in substantial investment in transmission facilities
for Delhi and Mumbai FM Radio stations... All of this has
resulted in erosion of its share capital," HT Media said.
Though HTML claims that it will continue incurring losses
in the near term as the radio business is still in an expansion
mode, it is hopeful about revenues picking up by 2009-end.
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