Announcing this at an investors' meet on Friday, Zee Network chief executive officer Vijay Jindal said the swap ratio is yet to be put up for approval before the regulatory bodies and shareholders. Incidentally, the ZTL board had approved the merger of the Mauritius-based ZMW with ZTL recently.

In another move, Zee TV will float a new company for its Internet services in which ZTL will hold around 25 per cent stake. The balance will be thrown open to ZTL's shareholders. "We don't want to burden ZTL with new business which may take time to be profitable," said Zee TV chairman Subhas Chandra.

The company will offer the Internet services by October, Chandra later told the press. The company is planning to make an investment of Rs 500crore in the new venture.

SitiCable, the cable distribution arm which has started laying fibre optics, has ambitious plans to expand bandwidth and provide Internet services. On being questioned whether Zee TV has to obtain permission for fresh investment by Rupert Murdoch who owns a 50 per cent stake in SitiCable, Chandra said: "It was not necessary." "If the joint venture partner does not invest, his stake will automatically get diluted," he added.

Zee TV is also planning to invest Rs 120 crore in the direct-to-operator project which will be operational by September.

The company will launch eight regional channels by then. Funding for the project will be mainly through internal accruals. "But we will raise some part of debt from the Indian market," Chandra said.

While Zee TV will be a free-to-air channel in the analogue mode, the rest of the channels -- Zee News, Zee Cinema and Zee Music -- will go digital. "Zee TV is a predominantly advertisement-driven channel. We can afford to be free-to-air forsome time," said Chandra.

On May 8, the Zee channels migrated from AsiaSat-1 to AsiaSat-3 as the life of the old satellite is almost coming to an end. This has enabled Zee to reach out to 20 new countries without spending anything, Chandra said. Music Asia, however, remains on Pas-4.

Zee TV's major thrust this year will be to increase revenues in non-prime time slots. The network is also getting into new business areas like production of animated films. Bhagmati will be the first animated film in the country. "We are revamping Zee News. Zee Cinema and the news channel will be our main drivers in the pay market when direct-to-home broadcasting is allowed," said Jindal.