MUMBAI: South Asia FM Ltd (SAFL), a subsidiary of the Sun TV Network, has entered into a strategic alliance with Red FM to further its FM Radio broadcasting business in the North, West and East Indian markets.

According to a release issued to the Bombay Stock Exchange by the company, SAFL has taken up a 48.9 per cent beneficial interest in Red FM by acquiring equity of the holding Companies of Red FM at par. The promoters of Red FM would continue to hold 51.1 per cent in Red FM. In lieu of this, the promoters of Red FM - Usha Reddy, Arjun Rao along with NDTV have, through their investment Company A. H. Multisoft and NDTV News respectively, subscribed to 35 per cent of the enlarged equity of SAFL. The balance equity of SAFL continues to be held by its existing shareholders.

SAFL owns 23 FM radio licenses all over India (except the Southern states of Tamil Nadu, Karnataka, Andhra Pradesh and Kerala). It currently has two operational radio stations at Jaipur and Bhubaneshwar. Red FM, on the other hand, operates three radio stations in Mumbai, Delhi and Kolkata and claims to be the number two player in two of the largest FM radio markets in India, Mumbai and Delhi. This alliance enables the company to boost its presence in the fast-growing Radio market in India, says the release. Red FM was launched as part of the India Today group in 2003, which exited the venture in late 2005.