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Star pulls Tata Sky plan
Rupert Murdoch’s Star India has withdrawn its proposal to the Foreign Investment Promotion Board (FIPB) to increase its stake in DTH firm Tata Sky.
Star had wanted to up its stake from 20% to 29.8% and the FIPB had earlier deferred making a decision on…
Rupert Murdoch’s Star India has withdrawn its proposal to the Foreign Investment Promotion Board (FIPB) to increase its stake in DTH firm Tata Sky.
Star had wanted to up its stake from 20% to 29.8% and the FIPB had earlier deferred making a decision on the deal.
The most likely reason for Star to have pulled the plug is because approval was unlikely to be granted, and the Information & Broadcast ministry was said to be against the move.
Star has been attempting to take advantage of a change in Indian legislation pertaining to FDI made last year. The current law stipulates that foreign investment in Indian DTH operators cannot exceed 20%. However, foreign entities are now permitted to buy an additional 29% if the investment is made through companies owned and controlled by Indian nationals.
Tata Sky, which has around 4.5 million subscribers, is India’s second-largest DTH service provider after Zee Group’s Dish TV.
Tata Sky sold a 10% stake for US$56m to Singaporean state-owned investment firm Temasek in 2007. The Tata Group is the majority shareholder in the firm.
