MUMBAI: Digicable Network (India), which is being acquired by Reliance Communications in an all-stock deal, has proposed to absorb its cable TV subsidiaries across the country with itself.
The subsidiaries that would be amalgamated include Life Style Communications (cable network in Hyderabd), Central India Digital Network (Jaipur), Digi Multinational Network (Delhi), Digi Ruby City Network (Hyderabad), Digi Maharaja Network, Digi Raigadh Network, Digicable Central (India) Cable Network and Digi Corporate Services ( a services company).
The decision to amalgamate all the subsidiaries will enable Digicable Network to have a strong financial and operational structure. Digicable will be capable of mobilising resources and the financial consolidation will be necessary to withstand the new competitive environment.
The amalgamated company will, thus, have the benefit of synergy and stability of operations, helping it to achieve economies of scale through efficient utilisation of resources and facilities. The companies concerned would be able to combine their resources, expand their activities, rationalise and streamline their management, business and finances as well as eliminate duplication of work to their common advantage.
The Bombay High Court is seeking the nod from the unsecured creditors to the Scheme of Arrangement. The appointed date of the Scheme will be 1 April 2009.
Digicable will take up the debts, liabilities, duties and obligations of the companies that are to merge under the Scheme.
The authorised share captal of Digicable is Rs 1 billion, divided into 20 million equity shares of Rs 10 each and 80 million redeemable preference shares of Rs 10 each.
