The Board of Directors of Music Broadcast Limited (MBL), which operates the Radio City network in India, has approved the acquisition of Reliance Broadcast Network Limited (RBNL), a Reliance ADA Group company.

RBNL operates 59 stations of BIG FM, one of the largest FM radio networks in the country while MBL currently owns 39 Radio City stations.

Radio City will initially acquire 24% equity stake of Radio Broadcast Network Limited (RBNL), the terms of which are being finalised by way of a preferential allotment for a total consideration of Rs 2.02 billion. Further, on receipt of all regulatory approvals, MBL will acquire the entire stake held by the promoters of RBNL basis an enterprise value of Rs 10.5 billion after making adjustments for variations, if any, on the basis of audited accounts for the year ended March 31, 2019.

The entire transaction is expected to close in the first quarter of FY2021.

Through this deal, RBN will initially transfer charge of 45 BIG FM stations to MBL.  The remaining 14 will be handed over after their lock-in period gets over in March 2020. This will therefore make Radio City the biggest private FM network in India with 79 stations.

According to media reports, Amit Bapna, CFO, Reliance Capital said: “We are delighted to announce the asset monetization transaction with Music Broadcast Limited, a leading FM Radio broadcaster. This transaction is part of our overall strategy to reduce exposure in noncore businesses and will reduce Reliance Capital’s debt by an estimated Rs 1,200 crore.”