| MUMBAI: Star Group may have to rework its joint venture equity
arrangement with Balaji Telefilms specifically for the Bengali general entertainment
channel (GEC). Star Balaji, the name of
the JV company for rolling out regional language GECs, has Balaji as a 49 per
cent partner while Star will have the remaining 51 per cent.
In case
of the proposed Bengali GEC, however, Balaji's share could be below 49 per cent.
Star will have to give Ananda Bazar Patrika (ABP) Group the option of being an
equity partner, necessitating a formation of three shareholders. In Media Content
& Communications Services India (MCCS), the company which owns and operates
Bengali news channel Star Ananda, Star has a 26 per cent stake while ABP holds
the balance 74 per cent.
"Balaji Telefilms
is assured of equity but it will not be in the ratio of 49 per cent if ABP decides
to be a partner in the Bengali GEC," a source in the company says.
Star Balaji plans to launch the Telugu channel in September-October. The name
of the channel has not been frozen yet but it will have an identity similar to
the other language channels that are to roll out in future. Tamil channel Vijay
TV has an existing logo and name that will not be disturbed. Balaji will also
enjoy 49 per cent in Vijay TV which Star had completely bought out from UTV Software
Communications in mid-2004. "Star Balaji will be the name of the JV
company. But the Telugu channel name has not been frozen yet," the source
says. Vijay TV is a profit-making channel by keeping operational costs
low. "Balaji will have the benefit of enjoying a stake in an existing channel,
which earns marginal profits, to support the initial losses from the new broadcasting
ventures. It will also make up with the revenues kicking in from the content front
as it will have the status of being a preferred supplier for the language channels,"
the source says. The new JV company will initially have a capital infusion
of Rs 600 million from Balaji Telefilms for Vijay TV and the Telugu channel. Star
will also pump in capital to support the two channels. | 
