Sun and Gemini TV to merge

Sun TV has announced that the board of the company and Gemini TV has approved the amalgamation of Gemini with the company.

The boards has approved an issue of 1.78 equity shares of Rs 10 each of the company for every equity share of Rs 10 each of Gemini. This would involve an issue of 178,00,000 shares of the company to Gemini shareholders. The board of directors of the company and Udaya TV has approved the merger of all divisions of Udaya, except the FM radio division, with the company.

The boards have approved an issue of 19.72 equity shares of Rs 10 each of the company for every equity share of Rs 10 each of Udaya. This would involve an issue of 118,32,000 shares of the company to Udaya shareholders.

The board of directors of the company, Gemini and Udaya has approved the scheme of arrangement which governs the above amalgamation and merger.

After the proposed amalgamation and merger, the outstanding equity share capital of the company will increase from 688,89,155 to 985,21,155 equity shares of Rs 10 each. The additional 296,32,000 shares proposed to be issued will constitute 30% of the enlarged equity capital of the company.

The company is proposed to be renamed as Sun TV Network on completion of the proposed merger. Gemini owns and operates five television channels; Gemini TV, Teja TV, Gemini News, Gemini Music and Gemini Cable Vision.

Udaya owns and operates four television channels; Udaya TV, Udaya Movies, Udaya Varthegalu and Udaya TV II.

The company currently operates four television channels; Sun TV, KTV, Sun News and Sun Music in Tamil language, two television channels; Surya TV and Kiran TV in Malayalam language, three FM radio stations, and another three FM radio stations through its subsidiaries.

The two subsidiaries of the company Kal Radio and South Asia FM, jointly hold 41 FM radio licenses for FM radio stations across India. With this proposed amalgamation and merger, the company will increase the number of television channels in its bouquet from 6 to 15 channels. The proposed amalgamation and merger will enable the company to build a dominant presence in entire south India, and emerge as one of the largest and most profitable television broadcasters in India.

Enam Financial Consultants and DSP Merrill Lynch acted as advisors to this transaction. The merger is subject to final approval by shareholders, creditors and the high court.