It?s boom time for the media industry as the foreign investment promotion board (FIPB), the nodal agency for foreign investments, is said to have given its nod for the inflow of over Rs 750 crore of foreign investments at its last meeting held earlier this month.
The US-based private equity fund Blackstone and Malaysian investor Astro are the prominent overseas players who will be pumping in money in the media companies including Jagran Media, NDTV Lifestyle Holding and Kal Media among others.
After the FIPB approval, Blackstone will put in Rs 225 crore in Jagran Media for around 13% stake while Astro that will put in $40 million (about Rs 184 crore) in NDTV Lifestyle Holding in lieu of a 49% stake, as reported first by FE. Astro is also set to invest another Rs 350 crore-plus in Kal Media, a Kalanithi Maran firm which in turn will be invested in Sun Direct DTH services of the company.
According to official sources, FIPB gave its nod to Jagran Media to receive Rs 225 crore from Mauritius-based private equity firm Blackstone GPV Capital Partners. Jagran Media is a subsidiary of the Jagran Group, the publishers of Hindi daily Dainik Jagran. The proposal from Jagran had been deferred thrice before by the FIPB after objections from one prominent shareholder and close examination by the information and broadcasting ministry.
But Astro?s investments in NDTV is seen as a significant move in the broadcasting space. NDTV will infuse these funds from Astro in NDTV Lifestyle, the promoter of NDTV Goodtimes, the lifestyle channel of NDTV group. Astro will invest in NDTV Lifestyle Holding through its Mauritius-based subsidiary South Asia Creative Assets Ltd (SACAL). Incidentally, SACAL also owns 80% stake in celebrity chef Sanjeev Kapoor?s television firm.
?Astro stake in NDTV Lifestyle comes within four months of NDTV calling off its earlier agreement with US-based Scripps Networks Interactive. This is significant,? said a Mumbai-based analyst who tracks media firms. According to the analyst, this may signal a future alliance with Turmeric Vision, the television production firm of celebrity chef Sanjeev Kapoor. ?In July, Astro had picked up 80% stake in Sanjeev Kapoor?s TV firm. We can expect some sort of alliance between the two firms as both have same investor,? a senior media analyst from a leading consultancy firm said.
After the FIPB nod, NDTV Networks, the parent company of NDTV will own 51% in NDTV Lifestyle Holdings which in turn will own 92% in NDTV Lifestyle Ltd. This would effectively give Astro a 45% stake in NDTV Lifestyle. However, despite the news, NDTV stocks closed at Rs 114.90, up only 0.88% on Tuesday.