BBC Worldwide wants to enter the Indian FM radio industry by acquiring up to 20 per cent equity in Mumbai's private FM radio operator, Radio Mid-Day.
BBC Worldwide has an approval from its board to invest up to Rs 55 crore (Rs 550 million) in the Indian FM radio sector. In its application to Foreign Investment Promotion Board, the company has not specified the money it will spend on acquiring the stake in Radio Mid-Day.
Government officials say it will, after obtaining permission for the acquisition, bring in investments in a phased manner. This is the first firm foreign direct investment proposal in the domestic FM radio industry, coming soon after the government decided to allow FDI up to 20 per cent.
Richard Branson's Virgin Group has shown interest and is learnt to have bid with an Indian company for frequencies in key markets. However, Virgin has yet to apply for government approval.
Mid-Day Multimedia owns 82.98 per cent of Radio Mid-Day, while the remaining 17.02 per cent is held by Ferrari Investments and Trading Company. The present paid up equity of Radio Mid-Day is Rs 59.34 crore (Rs 593.4 million). This will be the second joint venture for BBC Worldwide in India.
It recently tied up with Bennett Coleman and Company to publish technical, scientific and speciality magazines.
Radio Mid-Day, which was awarded frequencies to operate three stations in the first round of FM radio bidding, has applied in the second round for licences in all the four regions and twenty stations.
In the first round of bidding Radio Mid-Day was allotted three frequencies, out of which only one -- GO FM in Mumbai -- is operational.
In the south, Radio Mid-Day was allotted a frequency in Chennai. The licence was surrendered by the company in August 2002. Similarly, the company was also awarded a frequency in Delhi, which was also surrendered by the company in August 2002.