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The Game of Radio: Acquisition of Big Fm and Radio One



In May 2019, two private Fm stations, Fever and Radio City announced that they would be acquiring Radio One and Big Fm, respectively.

This article explores the business logic behind these acquisitions.

Please note that at the time of writing this article, Fever had already acquired Radio One while City said that it was taking substantial equity in Big Fm; the acquisition of 92.7 Fm is still a few months away.


Fever’s acquisition of Radio One

In 2015, Fever had purchased their second frequency and that is how Nasha came into being. The latter complements the Fever footprint, but HT Media Limited felt there was room for some more inorganic acquisition.
That opportunity came in 2019 when Fever acquired the company for more than Rs. 300 crores.

Radio One is known for its cool retro music and is well accepted by its core target audience- 35-45-year-olds who love English music. Fever wasn’t present in this segment before it acquired One.

With the acquisition of Radio One, HT Media Limited is now present in general entertainment, CHR, and retro English hits. This also means that with this acquisition, HT Media Limited now targets people from 18 years old to 45 years old.

There is another reason why it made sense to acquire Radio One which was launched by Tariq Ansari of Mid Day.
Currently, 65-70 % of any radio network’s revenues come from the top metros. In radio terminology, the top metros are Mumbai, Delhi, Chennai, Bangalore, Hyderabad, and Kolkata.

Historically, HT Media was only strong in Delhi and Mumbai. But after this acquisition, this media company has now 22 stations across 15 cities, most of whom are metros.

When companies acquire their rivals, the former evaluate the total worth of the target companies. This exercise is called brand valuation and is fairly common in consumer companies.


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We are quite certain that HT Media would have evaluated Radio One before acquiring it. This company has carved a niche for itself in the radio market ever since it was launched in the early 2000s. For Tariq Ansari, this was a good deal given the annual revenues of One before its acquisition were in the region of 72-80 crores.


Radio City- Big Fm

In May 2019, Radio City surprised the private Fm industry by declaring that it was acquiring Anil Ambani’s Big Fm.
Also known as Music Broadcast Private Limited, Radio City is closely related to Dainik Jagran. This private Fm network was acquired by Jagran a few years ago. Currently, City along with Radio Mirchi and Big Fm is among the top 3 networks in the industry.

At the time of writing this article, Radio City has acquired only 24% stake of Big Fm for Rs. 200 crores. After getting the necessary approvals, it would acquire the rest of the company by paying Rs. 1050 crores to Reliance Broadcast Network Limited, the holding company of Big Fm.

The company currently owns 39 stations while Big Fm has 58. However, the former will take only 40 stations from the Big kitty thus positioning itself as the largest private network in India.

By acquiring Big, Radio City hopes to penetrate almost all the country, particularly the Hindi heartland. A few years ago, this company had acquired Radio Mantra, closely linked with Dainik Jagran, to reach out to listeners in Haryana, western and eastern UP and Jharkhand.

Unlike the Fever –Radio One merger, the Big Fm acquisition is more about expanding current reach within the same TG than reaching out to new target groups. Big Fm is known for giving tremendous reach to its advertisers with its dirt-cheap advertising rates. So while City gains Big’s incremental reach, it will have to correct the rate-led distortions left by Big Fm.

What is more interesting to note is how Radio City will fund its acquisition of Big Fm.

Akanksha Holani

Author: Akanksha Holani

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