Anurag Batra of Exchange4media and investment banker Vikram Jhunjhunwala, representing a set of investors, buy business magazine for an undisclosed sum
Media behemoth ABP Pvt Ltd has sold its business magazine Businessworld to Anurag Batra of Exchange4media and investment banker Vikram Jhunjhunwala, who is representing a set of investors, in what could be the first instance of a portal buying a print magazine in India. Recently, Amazon chief Jeff Bezos had bought news daily Washington Post for $250 million.
“We have just closed the deal with Anurag Batra of Exchange4media; Vikram is representing a set of investors in this deal,” said a senior ABP official. He, however, didn’t specify the size of the deal. Earlier, speculation was rife the deal could be valued at Rs 15-20 crore. Rumours had it Kerala-based Malayala Manorama was a potential buyer.
|Some of the former Businessworld editors|
Launched in 1981, Businessworld was recently turned from the country’s only weekly business magazine into a fortnightly. It directly competes with three other business magazines brought out by different media groups — Business Today, Outlook Business and Business India.
On September 3, Business Standard had reported ABP had put its business magazine on the block. ABP was actively scouting for a buyer for the magazine, as it wasn’t generating revenues for the company.
When contacted, ABP Managing Director and chief executive D D Purkaystha confirmed the media giant had sold its fortnightly to Anurag Batra and Vikram Jhunjhunwala. Over the phone, Batra refused to comment on the deal. He didn’t reply to a message by Business Standard.
“It’s really sad. The product was a great one and it continues to be,” said the editor of a business magazine, on condition of anonymity.
Tony Joseph, a former Editor of the magazine, thought the sale could also be an opportunity for the magazine to recast itself in the changed media environment. "It is good that Businessworld has found a buyer. It is a strong brand. I hope the new buyer has the creative imagination and the business acumen to reinterpret it for the digital era."
Purkayastha told Business Standard Prosenjit Datta would continue to hold the post of editor, Businessworld. The magazine has an editorial staff of 51. “A final call on the employees would be taken after a round of meetings,” said a source.
The transition may take about a month.
Exchange4media was set up in 2000 to cater to the marketing, advertising and media sector. The company’s portfolio includes magazines such as Pitch, Impact, FranchisePlus, Realty Plus and web portal exchange4media.com. The company had earlier said it planned to launch more niche titles and expand abroad. Earlier, Jhunjhunwala was managing director, FiNoble Advisors Pvt Ltd.
Delloite India Director Sandip Biswas said the deal reflected the rise of digital media in industry value chain.
“This deal would help Exchange4media, as acquisitions are the best way for digital portals to expand reader base. While magazines have been under pressure and only a select few would do well in the future, the scope of digital magazines is strong,” said Ashesh Jani, partner, Deloitte Haskins & Sells. The deal comes at a time when the overall media sector is seeing a slowdown. Ads have dried up, as companies are failing to meet business targets. In fact, ABP had recently raised the ad rates for its newspapers about 15 per cent.
During a recent interaction, Purkaystha had said the current environment was worse than the financial crisis of 1991. The depreciating rupee and rising news print costs have added to the woes of publishers. Importing newsprint for magazines are affecting margins, newsprint accounts for 40 per cent of a newspaper or magazine’s costs.
Many news dailies and magazines have cut the number of pages and a number of magazines have shut shop. Recently, the Outlook Group had shut three of its magazines---Marie Clare, Geo and People. Network 18, which runs channels such as CNN IBN, CNBC TV18, CNBC Awaaz and IBN 7, recently let go about 500 employees, terming the process as inevitable restructuring.
NDTV Profit, too, went through a restructuring drive.
The Indian business magazine market is estimated at Rs 100 crore. Costs have risen about 10 per cent this year, while growth in the segment has been merely seven per cent. Industry data show magazines’ readership stands at 83 million, while business magazines have a readership of 3.63 million.