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Our Bureau

Mumbai , April 23

The FM radio business of Adlabs Films Ltd (AFL) will be demerged to become a wholly owned subsidiary, the board of directors of the company decided on Sunday. Shareholders of AFL will get two shares in the subsidiary for every one share held, said a statement from the company. The subsidiary is proposed to be listed on the BSE and NSE.

The demerger will not have any impact on the share capital of AFL, the statement said.

The Scheme of Demerger also envisages amalgamation / merger of two subsidiaries of AFL — Entertainment One (India) Ltd and Mukta Adlabs Digital Exhibition Private Ltd — with itself. The Scheme is subject to the necessary approvals.

Benefits

According to AFL, the demerger of the FM radio business will lead to the following benefits to all stakeholders of the company: Creation of an independent focused organisation to grow the potentially high growth FM radio business; enhanced financial flexibility to independently raise resources for future growth; optimal valuation of the business as an independently and separately listed entity; and ability to attract and retain high quality talent through implementation of ESOPs.

More Stories on : Radio/TV | Restructuring

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