MUMBAI: Anil Dhirubhai Ambani Enterprises (ADAE) has finally created a radio division for its FM radio foray and has sought government clearance for the same.

The radio division of Adlabs Films, which bagged FM radio licences in several cities of India and is one of the bigger players in the arena, will be called Adlabs Radio Pvt Ltd.

However, a brand name under which Adlabs Radio will run the FM radio services has not been decided yet.

According to sources in the information and broadcasting ministry, the proposal is "under routine examination".

Adlabs Radio Pvt Ltd is a special purpose vehicle (SPV) created by ADAE for its radio business, while the corporate entity and the official licencee continues to be Adlabs Films Ltd.

The SPV has been created for a focussed approach on the radio business as Adlabs Films concentrates more on the business of running multiplexes and post-production film facilities.

Under the licencing agreement, licences are not transferable after being formally awarded to a company.

In the recently-concluded bidding process for FM licences, the government has allowed foreign investment up to 20 per cent in radio ventures, but such deals had to be concluded before the bids were opened in the first week of February.

Moreover, no change in shareholding pattern is allowed, under the guidelines, for the first five years of the 10-year licence period.

The Anil Ambani controlled Adlabs Films has won 57 frequencies across the country, but had to surrender 12 stations to adhere to another norm, which mandates no single company can own more than 15 per cent of the total number of frequencies put up for sale throughout the country.

Adlabs Films' scrip opened on Wednesday at Rs 403 on the Bombay Stock Exchange (BSE) and touched a high of Rs 409 and a low of Rs 395 during the trading day.