Scripps buys majority stake in NDTV Lifestyle
Scripps Networks Interactive has bought a 69 per cent stake in NDTV Group’s lifestyle content’s subsidiary – NDTV Lifestyle.
The transaction, to be completed by the end of the first quarter of 2010, is pegged at $55 million.
In what could be a precursor to a deal with Turner International for NDTV Imagine, NDTV Group has in a separate transaction repurchased the $100 million step up coupon bonds due 2012. This frees NDTV from the restrictive clauses and allows it to pursue investors for its different verticals.
NDTV, which will keep 31 per cent stake in NDTV Lifestyle, did not separately reveal how much it got from the stake sale. “Part of the $55 million is going to come into the company,” a source in NDTV said.
NDTV Lifestyle, which runs the English lifestyle channel NDTV Good Times, will launch other lifestyle television channels.
US-based Scripps Networks Interactive is the lifestyle-oriented content developer for television and the Internet.
“Scripps Networks Interactive and NDTV are clear leaders in lifestyle programming, which makes this strategic alliance between our two companies particularly powerful,” said NDTV Group founder Prannoy Roy.
“With the unparalleled experience that Scripps has creating lifestyle brands and NDTV�۪s depth of knowledge of the Indian market, we intend on building strong lifestyle media businesses that will aggregate large and engaged audiences in India.”
For Scripps, the proposed joint venture with the NDTV Group follows the formation of two other partnerships this year that will result in significant distribution of the Scripps-owned Food Network in Europe, the Middle East, Africa and Asia.
Smeeta Chakrabarti, who has served as chief executive officer of NDTV Lifestyle since 2007, will continue in that leadership role after the transaction is completed as will other members of the NDTV Lifestyle management team.
Meanwhile, NDTV’s UK subsidiary NDTV Networks Plc has repurchased the $100 million step up coupon bonds due 2012 for $72.4 million. NDTV Networks Plc has financed the repurchase through bank loans.
“Our payout would have been $115 million if the interest element is also taken into account. We have bargained and bought out the bonds for $72.4 million,” the source said.
The repurchase has allowed NDTV Networks Plc to significantly reduce its outstanding borrowings and also to cut down on the interest burden.
“Consequent to the repurchase of the bonds by NDTV Networks Plc, the restrictive covenants, which were applicable have ceased, allowing NDTV Networks Plc and its subsidiaries flexibility for restructuring and financing the businesses including being able to access bank finances for working capital and other requirements,” NDTV said.
