Radio One exploring new investors ahead of Phase III

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(22 October 2011 6:16 pm)

MUMBAI: Radio One, the joint venture between Next Mediaworks Limited (earlier Mid-Day Multimedia Limited) and BBC worldwide, is scouting for investors even as its promoters are converting part of the debt to equity to reduce over gearing.

The company, which operates Radio One FM stations in Mumbai, Delhi, Kolkata, Chennai, Bangalore, Pune and Ahmedabad, is gung ho about phase III expansion and is looking at it as an opportunity to improve its business efficiency in the metros.

"Key shareholders, in a show of confidence, are converting a
considerable part of debt to equity to reduce over gearing and are exploring new investor interest due to the strategic value that the company has as it holds only lucrative metro licenses critical for any player entering the radio business," Next Mediaworks chairman Tariq Ansari said.

Earlier, in August, Radio One promoters were looking at infusing fresh capital into the company. "The promoters will shortly infuse more funding into Next Mediaworks in order to strengthen our balance sheet and prepare for the next round of auctions," Ansari had then said.

Radio One has posted an almost 10 per cent revenue jump to Rs 231.6 million for the six-month period ended 30 September 2011 compared to Rs 211 million a year ago.

Ansari said, "Next Mediaworks is also incubating a digital business as a future strategic initiative that helps us take advantage of the global 3G and 4G space."

The loss before tax in the first six months of the current year is down 44 per cent to Rs 63.5 million, as against Rs 112.7 million in the earlier year.

Radio One said that the company seeded a new revenue stream in the music concert space which contributed promisingly to total revenues in H1. "The industry grew 7 per cent in the markets that Radio One operates," it said.

Radio One Ltd MD Vineet Singh Hukmani said, "The company sees phase III as an opportunity to improve its business efficiency in the metros using networking that lowers cost and the news and current affairs space that offers higher revenue opportunity. New metro cities are being evaluated for their revenue to cost ratio and the company is in the final stages of deciding which cities it would consider bidding for."
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