Industry & Economy
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Radio/TV
I&B Ministry asks Space TV to amend shareholders' agreement
Our Bureau
New Delhi
,
May 12
THE Information and Broadcasting (I&B) Ministry has written to Space TV, the 80:20 joint venture between Tata Sons and the Star Group for direct-to-home (DTH) broadcasting, to amend its shareholders agreement.
According to Government sources, "After examining the comments received from the Ministry of Company Affairs (MCA), we have asked the company to rework its shareholders' agreement." The MCA was of the opinion that the current shareholders' agreement is not in line with the existing DTH guidelines and the Company Law. The I&B Ministry had sought its views on whether the minority foreign partner could enjoy powers equal to that of the majority stakeholder.
As per the agreement, any major decision by the board would require the approval of at least one nominee director of the minority stakeholder. It also provided for the board to appoint key officials and delegate powers. The Government was of the view that these clauses could be interpreted as giving the minority shareholders considerable powers in the management of the venture, which goes against the DTH guidelines.
The DTH guidelines issued by the I&B Ministry have stipulated that the applicant company must have Indian management control with majority representatives on the board as well as the chief executive of the company being a resident Indian.
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