Modi is buying the stake in Multi Screen Media, formerly known as Sony Entertainment Television (India), through his MC Global company.

MSM's family of nets is headed by Hindi-language general entertainment channel SET India, traditionally the country's No. 3 network. It also includes SET Max, Sab TV, SET Pix and Indian versions of AXN and Animax.

Sony owns 61% of MSM, 8% is held by U.S. financier Capital Intl. and the remainder is owned by a group of Indian investors that include Shemaroo Entertainment's managing director Raman Maroo, World Media Group director Sudesh Iyer, MobiApps Holding's Jayesh Parekh and actor Jackie Shroff.

Details of the deal have not been made public.

Speaking in New York, SET CEO Kunal Dasgupta said he had no knowledge of the deal. "There have been so many rumors of this kind over the years," he said. "I have no preference as to who it should be, shareholders are shareholders."

Parekh, contacted in Perugia, Italy, offered no comment.

A deal could remove a corporate ownership problem that has dogged MSM for several years, while ratings have slid.

Local investors have wanted out of the operation for several years. They were thwarted in 2006 when the company's planned listing on the Bombay Stock Exchange fell through.

Other attempts by Sony to buy out the minority investors became stuck over price.

The MC Global deal appears to neatly split the difference between the $200 million that Sony had reportedly offered for the stake and the $400 million sought by the Indian investors.

The conflict moved up a notch earlier this year when the Indian and U.S. investors objected to a $40 million capital raising rights issue and launched a law suit against the MSM management.

MSM said that new coin was needed to refresh the program schedule and to fund its successful bid for ten-year TV rights to the new Indian Premier League cricket tournament.

Initial ratings performance of IPL cricket on SET Max suggests it has a winner, but SET and Singaporean World Sports Group had to commit $1 billion for the rights.

Deal marks Modi's long awaited step into the forefront of Indian entertainment.

Modi has a diverse array of businesses through MC Global, MCorp and other companies and is a joint owner of stock market-listed regional cell phone operator Spice Communications.

He has previously considered expanding into Indian movies and has announced plans to produce a Hollywood-sized Buddha-themed movie based on the book "Old Path White Clouds," the epic novel that made an international star of its author, the Vietnamese monk Thich Nhat Hanh.

Last August, Modi bankrolled the Indian Splendor festival of Indian film in Los Angeles.

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