TV18 buys 53% stake in Infomedia India

MUMBAI: TV 18 has acquired at least 53 per cent stake in publishing company Infomedia India Ltd., from an ICICI Venture managed fund.

The stake will be purchased in a staggered manner – 40 per cent immediately. The 40 per cent stake has been acquired for a total purchase consideration of Rs 1.78 billion (Rs 178 crores). This acquisition would enable TV 18 to enter the publication businesses. TV18 will also benefit from the cross media leverage of its existing brands. YES Bank was the exclusive financial advisor to ICICI Venture Ltd. and BMR Advisors assisted TV18 for the transaction.

The 40 per cent stake will be followed by an open offer for 20 per cent of Infomedia. In the event that the open offer does not garner enough response, then TV 18 has the right to purchase such number of shares from the ICICI Venture managed fund so as to augment its stake up to at least 53 per cent. The transaction is subject to statutory and regulatory clearances, wherever necessary.

Infomedia India Ltd has further agreed to issue 50 lakh warrants to TV 18 and 10 lakh warrants to the ICICI Venture managed fund. This issue is as per SEBI pricing norms and this fresh infusion of funds will be used to propel further growth in Infomedia.

Network18 managing director Raghav Bahl said, “This acquisition signifies our commitment to being an integrated player in the media and publishing space. This acquisition has come at an opportune time and will significantly accelerate our publishing growth plans.”

Network18 Group CEO Haresh Chawla added, “Infomedia has carved a niche for itself with its exciting array of publishing assets and national footprint. The fresh infusion of funds, combined with the strong management team at Infomedia will form a potent combination, thereby enabling the company to significantly leverage Network 18’s strengths in the television, internet and mobile businesses.”

Infomedia managing director Prakash Iyer said, “We are excited about TV 18’s strategic acquisition of Infomedia and look forward to building a bigger organization. Infomedia is already a leading publishing player and this acquisition will enhance the marketing of our value added offerings, which will be extremely relevant in a rapidly changing Indian media market. Our success today is largely also attributable to the continued support and commitment that ICICI Venture has provided to Infomedia.”

Infomedia is one of the first leveraged buyouts in India led by ICICI Venture. The sale process of ICICI Venture’s stake had witnessed strong interests from several strategic and financial investors, including international majors.

ICICI Venture managing director and CEO Renuka Ramnath said, “This is definitely a landmark deal in the fast growing media and publishing space between two leading players in the industry. Since the buyout, we have worked hard with the management to build a unique business model that is profitable and scalable. We believe that Infomedia is an excellent platform for TV Eighteen to meet its leadership aspirations in the media and publication space.”