Moves to lease out Channel Eye, which was under the purview of the Sri Lanka Rupavahini Corporation (SLRC), to the Lyca Group has resulted in much confusion.

While reports stated that the Lyca deal was blocked after Cabinet had not approved the proposal to lease the State-owned channel, Media Minister Bandula Gunawardana had told the media last week that Channel Eye had been leased to Lyca on a short-term agreement and that the Cabinet had not rejected the proposal.

However, senior Government sources noted that the Cabinet had not approved the agreement despite the Minister’s contradictory claim.

Nevertheless, the status of the SLRC-Lyca deal is quite unclear at the moment. The relevant agreement had reportedly been reached between the two entities last month. It is learnt that according to the agreement reached between SLRC and Lyca, the latter will have to pay a sum of Rs. 25 million per month to the SLRC.

Employees attached to SLRC said that the monies received monthly from Lyca were to be used to pay the salaries of SLRC staff as well as to maintain the channel. SLRC has faced a financial crisis in the past few months, even finding it difficult to pay salaries, since earnings of the channel were not commensurate with the spending. 

The Media Ministry called for tenders on 3 February to find a private investor for Channel Eye, which was an added financial burden on the cash-strapped SLRC.

Two leading communication institutions have forwarded bids for the tender that had closed on 17 February. However, the lease agreement has been reached following the appointment of a new Chairman to SLRC by Media Minister Gunawardana.

SLRC authorities had reportedly said that the lease agreement had been approved by the ministry. Gunawardana had submitted the agreement between SLRC and Lyca for Cabinet approval last week.