Suhel Seth, who is co-CEO and chief strategic officer of Delhi-based WPP Group agency Equus Red Cell, has bought out Kumar Mangalam Birla's 25 per cent stake in Media Content and Communication Services (MCCS), STAR's uplinking venture. Confirming the news to agencyfaqs! Seth said, "I have invested in this venture in my personal capacity. I have not been funded by anyone."
With this move, Seth has become the single largest stakeholder in MCCS with 30 per cent equity. He had a 5 per cent stake in MCCS prior to the acquisition of the Birla equity. When asked why as an ad man he was keen on investing in a media company, Seth replied, "It is just an investment opportunity for me."
After Seth, STAR (through STAR British Virgin Islands) is the second largest shareholder with 26 per cent stake in MCCS. The other shareholders in MCCS are DSP Merrill Lynch chief Hemendra Kothari (25 per cent stake), Hindustan Times editor Vir Sanghvi (5 per cent), film actor and Balaji Telefilms head Jeetendra Kapoor (5 per cent), theatre and television personality Maya Alagh (5 per cent) and STAR Group legal advisor Rian Karanjawala (4 per cent).
In an interesting aside, when Birla's position vis-à-vis MCCS was not getting clear, Jain TV chief JK Jain evinced interest in an equity participation in STAR's news operations. Things however, turned out differently.
To put things in perspective, the STAR group had floated MCCS with an equity base of Rs 4 crore as content provider for STAR's news channel. It offloaded 74 per cent stake in its news operations in compliance with the Government of India guidelines on foreign news channel uplinking from India.
According to the new uplinking policy announced by the Indian Government in late March, foreign holding in all news channels desirous of uplinking from India was capped at 26 per cent. Since STAR News, owned by Rupert Murdoch, was an on-air channel like CNBC India with a foreign shareholding, a transitory arrangement was announced by the Government.
In effect, the Government of India gave a temporary permission to STAR to uplink its news channel from India on June 26. After the dramatic exit of Kumar Mangalam Birla on Tuesday, STAR's news operations received yet another week's extension on Wednesday to continue uplinking in the current format. Â© 2003 agencyfaqs!