HT Media and Next Mediaworks have announced the signing of the binding term sheet for the proposed merger of their radio arms. The proposed merger aims to take advantage of a larger combined metro play subject to the approval of shareholders, legal bodies and the Ministry of Information and Broadcasting.
While it is difficult to predict the speed at which government approvals are given, the companies are looking at a time-frame of 12-18 months.
HT Media owns the popular Hindi radio channels Fever FM and Radio Nasha with a dominant presence across metros and UP while Next Mediaworks, through its subsidiary Next Radio Ltd, operates successful segmented radio stations across the major metros under the Radio One brand, including the only International format stations in the country.
While Radio One is a pioneer in the international format space, Fever and Radio Nasha are leaders in the Hindi CHR (contemporary hit radio) and Retro radio space respectively, and this proposed coming together allows a merged entity to offer enhanced value for listeners and advertisers by offering them clearly segmented high value products. Seven stations of Fever FM + Radio Nasha (Delhi-2, Mumbai-2, Bangalore, Kolkata & Chennai) and all six stations of Radio One (Delhi, Mumbai, Bangalore, Kolkata, Chennai, & Pune) will aim to come together in a proposed merged entity.
There will not be any change in the brand names of the radio stations.
Both radio companies, for now, will continue to operate ‘independently’ as before since the proposed merger is subject to government approval. Once the merger has all the requisite approvals, HT Media and its shareholders will hold 74% and Next Radio shareholders will hold 26% in the merged entity.
Vineet Singh Hukmani, MD and CEO, Radio One; and Harshad Jain, CEO Fever FM, will continue to function in their respective leadership roles.
Sales teams of both companies will continue to function independently as before and will not sell any combination products.
Announcing the strategic move, Shobhana Bhartia, Chairperson and Editorial Director, Hindustan Times, said, "Radio is a fast-growing segment and research has shown that it has significant urban listenership. Radio One’s merger with our metro operations gives us both a complete bouquet across English and Hindi in all of the country’s biggest radio markets and will help us serve listeners and advertisers better. Such consolidation is another sign of the growing maturity of the radio market. We're convinced that the merger will add value to all stakeholders. We look forward to working with Radio One to realize our common vision."
Tariq Ansari, Chairman, Next Mediaworks Ltd, said, "We are delighted to be combining our radio operations with the metro stations of HT Media. There is a strong operating logic for this combination - multiple formats in the most lucrative urban markets in the country with all the cost synergies and complementary skills to better service listeners and advertisers. Radio One has exhibited strong competence in building profitable segmented radio stations and HT Media is a powerhouse in the mass radio space. We believe that this merger will unlock value for all stakeholders and look forward to working with the excellent management team at HTML to make this happen."