- McDonald’s to shut down 169 outlets in India
- Triple talaq violates rights of Muslim women: SC
- WhatsApp Coloured Text Status Now Rolling Out to Android and iPhone
- Airtel to launch its own Rs 2500 4G smartphone before Diwali
- Sasikala uses 'barricaded corridor' in jail premises as private space, claims former DIG Roopa
- Police verification for passport to go online within a year
- 'Routine run' kills second IMA cadet in 2 days; 5 in hospital
- MLAs supporting TTV Dinakaran meet Governor, demand Palaniswami's removal
Dish TV, Siti Cable and promoter holding
MUMBAI: The media assets of the Essel Group, including direct-to-home (DTH) company Dish TV and cable TV network Siti Cable, are being formally divided among the brothers.
While Subhash Chandra will keep control of Siti Networks Ltd (earlier known as Siti Cable), younger brother Jawahar Goel will have Dish TV under his belt. Chandra will also have Zee Entertainment Enterprises Ltd (ZEEL) and Zee Media Corporation Ltd (ZMCL), the entertainment and news broadcasting businesses of the Essel Group.
Dish TV, with a market capitalisation of Rs 9,725.70 crore (Rs 97.26 billion), will be under the sole promoter holding of Jawahar. The other brothers, including Chandra, Laxmi Narain Goel and Ashok Kumar Goel, are retreating from being classified as the promoter group.
As per the family arrangement between the promoter group, Chandra, Laxmi and Ashok have communicated that they be declassified along with their respective family members as promoters of Dish TV and persons acting in concert with them. This will come into effect after obtaining necessary corporate and regulatory approvals.
As part of this move, Chandra resigned as Dish TV chairman late last year and the role was taken up by Jawahar. On 27 October 2015, Chandra resigned from the Dish TV board.
In a separate but related move, Jawahar, Laxmi and Ashok are going to cease being classified as promoters of Siti Networks Ltd (earlier known as Siti Cable). The control of the cable TV company will thus rest with Chandra.
The communication to this effect has been received from the brothers. Jawahar, Laxmi and Ashok have informed that they would be declassified along with their respective family members and persons acting in concert with them as promoters of Siti Networks Ltd. This will come into effect on receipt of necessary corporate and regulatory approvals.
The brothers in charge of their companies will own majority stakes in those companies they are in charge of. It is not clear yet whether the four brothers will own a small stake in each other’s business. Even if they do, these businesses will be run independently.
Thus, Dish TV and Siti Networks will have one brother as the promoter group. The other brothers will be excluded from being classified as promoters.
The promoter holding, however, will not fall, a source said. “There will be no impact in the running of the company. Nothing really changes,” he added.
Dish TV’s promoter holding stands at 64.44%, as of 30 June 2016. The promoter holding of Siti Networks, which has a market cap of Rs 3,009.82 crore (Rs 30.1 billion), is 73.58%.
The process of property division among the brothers had started some years back. While Laxmi was managing real estate, Ashok was given Essel Propack, the tube-packing company. In December 2014, Chandra, his immediate family members and the entities controlled by them were no longer part of the promoter group of Essel Propack as part of a modified family arrangement. Notifying the stock exchange, Essel Propack said that Chandra, his immediate family members and the entities controlled by them together held 3.54% in the company.
Dish TV’s promoter holdings are consolidated under Direct Media Distribution Ventures (42.90%) and Direct Media Solutions (16.89%), as of 30 June 2016. It is not clear how much the brothers own in each of these holding companies.
Dish TV is India’s first DTH company to be profitable at the net level. It reported net profit of Rs 692.4 crore (Rs 6.92 billion) in the fiscal ended 31 March 2016. The company has a net subscriber base of 14.9 million.
In FY16, Siti Networks Ltd turned profitable at the net level for the full fiscal for the first time in its history. The multi-system operator (MSO) has a digital subscriber base of 7.9 million as of 31 March 2016. Its total cable TV universe is 12.2 million subscribers.