Mauritius PE fund to pick up 10% in Asianet

Written by Ashish Sinha | New Delhi | Updated: Sep 8 2010, 03:44am hrs
In another major foreign investment flow into the regional broadcasting space, Mauritius-based private equity fund SIDOFI Communication Investment is all set to buy nearly 10% strategic stake in Kerala-based broadcaster Asianet Communication Ltd (ACL), which is backed by leading broadcaster Star TV India.

SIDOFI will buy this stake from another Mauritius-based equity fund Americorp Ventures. Americorp bought 9.33% stake in Asianet in 2005 at a reported amount of Rs 6.6 crore valuing Asianet at Rs 70 crore. However, going by a 25-fold jump in the valuation of ACL recently, Americorp is expected to sell its 9.33% stake to SIDOFI at Rs 168 crore. The valuation of ACL hit a new high recently, to about Rs 1,800 crore, after Stars Mauritius-based subsidiary SVJ Holdings picked up 23.65% in Asianet for Rs 425 crore in May this year. According to analysts, the active participation of international private equity funds in Asianet and other regional media groups like Sun TV Network is an indication of the phenomenal growth of the southern cable television market. The Asianet channels in Kerala (Asianet, Asianet Plus) are already leading the entertainment space. Asianet also operates entertainment channels in Karnataka (Suvarna), and Andhra Pradesh (Sitara).

But ACL is not new to investments. In October 2006, former BPL Mobile CEO Rajiv Chandrasekhar acquired 51% stake in ACL through his Bangalore-based company Jupiter Entertainment Ventures. However, in 2008, Star India picked up a majority stake in ACL through a joint venture with Jupiter Entertainment called Star-Jupiter. In December 2008, the Foreign Investment Promotion Board gave its approval to Vijay Television part of the Star-Jupiter JV to acquire 62.90% in ACL. Star has over 80% stake in Vijay Television.

Again, in May this year, Star through its Mauritius-based subsidiary SVJ Holdings, picked up 23.65% stake in ACL for Rs 425 crore as direct foreign investments.