All about Star India’s IPO and Uday Shankar’s Star News hire

All about Star India’s IPO and Uday Shankar’s Star News hire

It’s all there in his book that was released earlier this month.

Peter Mukerjea

MUMBAI: On one of his trips to India, James and I met the industrialists Mukesh and Anil Ambani. I had recommended to James that we meet them in case there was some form of alliance that could be formed with the Ambani family. Rupert had met the family patriarch Dhirubhai Ambani on one of his earlier visits, and they’d had a healthy mutual respect for each other’s success, business acumen and seniority. The Ambanis owned India’s most visible and successful public company. One of the brothers had publicly announced their intent to invest in media, to partake of the next phase of India’s growth. He promised to wire up the entire country, to provide broadband access and interactive media on a scale that hadn’t been seen before anywhere in the world/ In that meeting, they were very frank and said to James that if he wanted to have a scaleable business in India and give it depth and scale, he would have to take the company public. The perfect example of this was Unilever. They had turned their company in India into  Hindustan Lever Ltd and had become one of the country’s largest and most successful businesses. Going public would provide Star TV with funding for future growth and protection from other Indian media companies if we ever became really big.

This resonated well with James, and as the markets were picking up pace month on month, business valuations were beginning to look stronger. There was good revenue growth and the solid line-up of programming had gathered momentum and traction with Hindi-speaking viewers. A public offering of Star TV would capitalise on this success and market position. We would then also do an employee stock option plan whereby every eligible employee would get some shares in the company, which would help us retain key management for the next phase of growth. We needed to be in the cable business and, of course, there was the entire direct-to-home project that we needed to revive, which would require a substantial cash injection in the initial years.

I was sure James was convinced in principle of the wisdom of going public, but it was a matter of getting the right value for the business. I was also equally convinced that the management in Hong Kong wouldn’t want a public offering for the Indian business alone, as that would have shown up the extent of negative value that existed in the rest of the company. If that ever came to light, it would have meant the end of our Hong Kong operations as we knew it. However, it was abundantly clear that doing a public offering in Asia did not make any sense, as the bankers wouldn’t want to prescribe any incremental value to the whole because the Chinese arm of the business was practically without value. We were stuck in the debate about an IPO without making any headway despite the many meetings and number crunching exercise with bankers from around the world. But the idea remained sticky and seductive.



It became increasingly difficult for the new owners to continue with a channel that still wanted to dance to the now minority owners’ tune. Despite several attempts by both sides to remedy this through ,meetings and discussions, the message wasn’t getting through. Aveek (Sarkar) had to pull the plug on Ravina (Raj Kohli) and identify a replacement. I was invited to the final round of the selection process. The new proposed head of Star News was a young buck called Uday Shankar who had cut his teeth as a journalist in print but had gone on to do an exceptional job at Aaj Tak, owned by Aroon Purie’s Living Media. Aaj Tak was recognised as the number one Hindi news channel at the time for their hard-hitting political coverage. I remember having called Aroon one morning when we had formally parted ways with NDTV. I asked him if he was willing to sell Aaj Tak, and I was surprised that he was open to offers. I had a figure in mind, which was what we had budgeted to spend on building our own news channel, but he thought it wasn’t enough and our brief ‘negotiation’ came to a close soon after.

Uday was an unpretentious, straight-talking, hands-on news guy who was used to rolling up his sleeves. He was a great choice for Aveek, and I felt a twinge of envy that I had not chosen him myself when I was looking for a news head, but I had wanted an entertainment person to run the news channel, and Uday didn’t fit the bill. He did now, of course.

Over time, though, Star managed to get Uday to loosen up. I used to joke with him that joining Star had changed him from being a conventional news hound to someone who had put together a news channel that was more entertaining than the entertainment channels. He always took my joshing in the right spirit.

Star News had set the ball rolling, and several other channels started treating news as entertainment for which they’ve been recognised and awarded by the industry. These news channels have now formed their own News Broadcasters Association (NBA) so as to manage their own affairs and be their own self-regulating body, which is certainly the way to go so long as there are no renegade channels amongst their community who make their own rules and fear nothing, as the  boundaries of self-regulation seem to be flexible. But the channels themselves bear some of the blame for enabling the government to get involved by refusing to effectively control the quality of news output. Some news channels are not so much reporting the news as making it up, which is something we never did. We chose to report news we believed viewers would find refreshing and different, but we would never have made it up as we went along, as is being done by some channels today. Legal action has been taken against these channels now, and courts have bemoaned the state of the Indian media.

News channels chasing ratings have been the catalyst for what is now often called ‘fake news.’ Of course, ratings drive advertising revenues for all television businesses and news is no exception. But the moot point is, news is different. It has greater responsibility to the public to provide accurate, reliable information. New, should, in my view, not be defined by ratings alone, which by their very nature force news channels go seek out the sensational or to create it through so-called ‘sting operations’ and ‘breaking news’ opportunities. News channels should be assessed and rated on the accuracy and depth of their reporting – a measurement of quality – instead of merely on quantity. Such a measure would be the end of the ambulance-chasing that many channels pass for news in this country.   

(Excerpted from  Star Struck: Confessions of a TV Executive; Peter Mukerjea, Westland Books pp 278, price Rs 699, hardbound edition)