Mukesh Ambani’s Reliance Industries has sold a fraction of its stake in Eenadu TV to Raghav Bahl’s Network18 for Rs 2,100 crore in cash.
This will give Network18 a 100 per cent control in ETV’s non-Telugu news, 50% in non-Telugu entertainment channels, and 24.5% in Eenadu Telugu. In return, Reliance has access to content from TV18 group for its 4G broadband network that Reliance is all set to roll out this year. TV18 runs CNN-IBN, CNBC-TV18 and Colors.
“The combination of India’s leading TV content provider, with a bouquet of nearly 25 channels, and the Infotel, will be a significant step in bringing a high quality live TV’ experience to broadband customers across the country,” said a Reliance statement.
The TV18 group has been Rs. 1,400 crore in debt but that is expected to be cleared with Reliance’s funding.
“By inducting such a significant amount of equity, our balance sheets will become among the strongest in the industry. Also, by acquiring this strategic control over several ETV Channels, the TV18 will have a bouquet of leading television channels,” said Raghav Bahl, founder and promoter of the TV18 group.
The multi-layered deal involves the TV18 Broadcast shelling out Rs. 2,100 crore to buy out ETV’s Hindi news channels in Uttar Pradesh, Madhya Pradesh, Rajasthan and Bihar, and ETV Urdu, as well as a 50 per cent stake in ETV’s Marathi, Kannada, Bangla, Gujarati and Oriya regional channels, and a 24.5 per cent stake in ETV Telugu and ETV Telugu News. The Reliance group firms already own a 50 per cent stake in ETV’s Telugu channels and a 100 per cent stake in the other ETV channels with an investment of Rs. 2,600 crore.
This is the latest major merger after Walt Disney’s recent Rs 2,000-crore buyout of UTV Software, ZEE Network and Star TV’s distribution deal last year and Star TV’s acquisition of Asianet Communications three years ago.
ETV & Sony TV deal falls through; Network18 steps in
Sony TV India to buy 11 regional channels from ETV