The Hindu : Business : Sun TV joins hands with Malaysia's Astro

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Friday, Apr 06, 2007
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Sun TV joins hands with Malaysia's Astro

To provide DTH services in the second half of this year

NEW DELHI: The Sun TV group has forged a joint venture with the Malaysia-based Astro All Asia Network Plc to provide Direct-to-Home (DTH) services in India in the second half of this year.

Astro to pick up stake

Under the agreement, the wholly owned unit of Astro — South Asia Entertainment Holdings Limited (SAEHL) — will acquire 20 per cent stake in Sun Direct TV Pvt. Ltd. for $166 million (nearly Rs. 747 crore), which is the maximum permissible under the existing Indian media regulations for foreign direct investment in DTH, a statement from Astro said here on Thursday.

The joint venture's peak funding is estimated to be $670 million and will be incurred over the first five years of operation, through a mix of equity and debt capital.

Astro will fund the acquisition through its existing debt facilities of $300 million or through new alternative borrowings.

The annual cash flows of the joint venture are expected to become positive in the sixth year of operations, it said, adding that the DTH services are likely to be offered in the second half of 2007, utilising satellite transponders on INSAT 4B, which was launched in March.

"This venture is a culmination of our joint initiatives to develop new opportunities in India's fast growing media sector and is consistent with our strategy to grow in new markets by creating compelling regional content and developing platforms that would be the preferred provider of entertainment and information services in Asia,'' Astro Executive Deputy Chairman Ralph Marshall said.

Kalanithi Maran said, "with this venture, we look forward to a rapid growth in the customer base of Sun Direct in India.'' — PTI

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