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Rediff News  All News  » Business » B K Modi starts talks with SET's shareholders

B K Modi starts talks with SET's shareholders

August 14, 2008 10:42 IST

US-based industrialist B K Modi has resumed negotiations with the Indian shareholders of Sony Entertainment Television, now renamed Multi Screen Media (MSM). The talks with the shareholders for acquiring their 39 per cent stake had earlier failed after the 'exclusivity period' ended without reaching an agreement.

Modi, who wants to rebrand the television channel as Sony Spice TV, is believed to be quoting around $400 million for the 39 per cent stake. 

Separately, Modi has also started negotiations with Sony Ericsson, the world's third-largest handset manufacturer, to sell off his listed company, Spice Mobile.

The negotiations were shelved following a difference of opinion on prices.  "We intend to close both the deals by September," said a highly-placed source with MCorp, the holding company for B K Modi's group of companies.  

Flush with funds from the sale of his mobile service provider, Spice Communications, to Aditya Birla Group company Idea Cellular, Modi is looking at acquiring the stake held by the Indian promoters and private equity funds in MSM.

However, it would not be an easy task as others players -- like entertainment company UTV jointly with Disney - are also in discussions to acquire the stake in MSM. UTV is believed to have valued the company at around $800-950 million, which puts the valuation for the 39 per cent stake at $370 million.

B K Modi declined to comment, while an MSM spokesperson stated that the company does not comment on 'market speculations'.

If successful, the buyout will help Modi become the largest shareholder in the company after Sony Pictures, which holds a 61 per cent stake. MSM, which is an unlisted entity, is one of India's leading television channels and operates various TV channels like SET India, SET Max, SAB TV and SET Pix.

Rajesh S Kurup & Nevin John in Mumbai