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Sun TV to raise Rs 7-8 billion in IPO: Source

The a move could make it India's biggest media company ahead of Zee Telefilms Ltd.

india Updated: Feb 14, 2006 17:45 IST
Reuters
Reuters
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Sun TV Ltd will sell 10 per cent in an initial public offering, a source familiar with the deal said on Tuesday, a move that could make it India's biggest media company ahead of Zee Telefilms Ltd.

Founded by Kalanithi Maran -- brother of India's Telecommunications Minister Dayanidhi Maran -- Sun plans to raise Rs 7 to 8 billion ($158-181 million) in the IPO, the source said.

If Sun is able to sell the IPO at the top end, its market capitalisation could surpass Zee, which is valued at $1.6 billion.

Since its launch in 1993, the company has been growing in south India, especially Tamil Nadu with four channels, including a 24-hour news channel. It also runs two Malayalam language channel.

It also runs FM radio stations in the cities of Chennai, Coimbatore and Tirunelveli.

The firm, which operates from a political party's premises, would use the IPO proceeds to launch three regional news channels and build its corporate headquarters.

Sun is seen to be closely associated with Tamil Nadu's main opposition party, Dravida Munnetra Kazhagam (DMK), which is an ally of the federal government.

It reported a net profit of Rs 614 million and total income was Rs 1.58 billion for the first half year ended on September 30, 2005.

Kotak Mahindra Capital Company Ltd and DSP Merrill Lynch Ltd are managing the IPO, the source said.

First Published: Feb 14, 2006 17:45 IST