The board meeting that Balaji Telefilms will be holding tomorrow on whether to go through with a merger with HFCL Nine Broadcasting will be nothing more than a formality, if industry sources are to be believed.
According to the industry grapevine, the decision has already been taken that there will be no merger between the two companies.
Balaji CEO Sanjay Dosi, queried about the rumours doing the rounds that the deal was off, declined to comment on the issue and said an official statement would be made available after tomorrow's board meeting.
Balaji, in a notice to the National Stock Exchange last week and the Bombay Stock Exchange yesterday, had said the meeting was being convened to consider a review of the proposed merger of Nine Network Entertainment India (a wholly owned subsidiary of HFCL Nine) with the company.
HFCL (Himachal Futuristic Communication Ltd) Nine Broadcasting is a 51:49 per cent holding company held by Vinay Maloo and Australian media magnate Kerry Packer. HFCL Nine was to take a 20 per cent stake in Balaji Telefilms.
The markets were also buzzing with the rumours. The Balaji scrip closed at Rs 144.90 after it hit the 8 per cent upper limit of the circuit breaker for the second straight day. It opened at RS 133.50.
The market sentiment is that the merger is likely to be called off and this would be good for the company because a merger would have entailed earnings dilution.
