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Balaji ends pact with Star, to buy back Rs322 cr holding

Balaji ends pact with Star, to buy back Rs322 cr holding
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First Published: Tue, Aug 19 2008. 11 42 PM IST

Parting ways: A file photograph of Ekta Kapoor, Balaji Telefilms Ltd. Photograph: Hindustan Times
Parting ways: A file photograph of Ekta Kapoor, Balaji Telefilms Ltd. Photograph: Hindustan Times
Updated: Tue, Aug 19 2008. 11 42 PM IST
Mumbai/New Delhi: Balaji Telefilms Ltd on Tuesday said it is ending a four-year-old association with Star group and, according to the terms of an agreement between the parties, would be allowed to buy back nearly 26% in TV celebrity Ekta Kapoor-run entertainment content provider which an associate company of Rupert Murdoch-led global media conglomerate is holding.
Parting ways: A file photograph of Ekta Kapoor, Balaji Telefilms Ltd. Photograph: Hindustan Times
The six shows produced by Balaji and currently broadcast by Star Plus TV channel would continue.
The promoters of Balaji Telefilms would be allowed to buy back 25.99% stake from Asian Broadcasting FZ-Llc. (ABF), an associate of Star group, within eight months, failing which these shares could be sold to any non-competing entity, the agreement says.
Balaji promoters are entitled to purchase the entire shareholding held by ABF in the company for an average price of Rs190 per share, within 240 days. At the agreed price, which represents a premium of 9.8% over the current market price, ABF’s holding would be worth Rs322.01 crore.
Balaji and Star have also agreed to terminate another regional languages joint venture agreement signed in April 2007, the company said in a filing with the Bombay Stock Exchange (BSE).
The content supply agreements with Star for various shows of Balaji would also be modified to remove the curbs imposed upon it relating to exclusivity on certain prime time slots. Shares of Balaji Telefilms closed at Rs169.25 on BSE, down 1.94%.
‘Mint’ first reported on 14 March that serious differences had risen between the two partners. On 7 June, it reported that Star could sell its stake in Balaji and on 5 August, the paper reported Star and Balaji have finally reached an agreement to part ways.
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First Published: Tue, Aug 19 2008. 11 42 PM IST