Viacom18 mulls TIFC acquisition

Viacom18 will make a voluntary offer to buy The Indian Film Company (TIFC), which is listed on the London-based Alternative Investment Market (AIM). Viacom18 is a 50:50 joint venture between IBN18 — a Network18 Group company — and US media major Viacom Inc.

"As part of the company's planned expansion in the entertainment space and acquisition of synergistic content, Viacom18 is contemplating making the offer," the company said in a release to stock exchanges on Monday.

TIFC is a closed-ended investment fund which makes investments in Indian films. It was listed on AIM in 2007 and in the last six months, Network18 and its affiliates have picked up 80.4 per cent in the company.

 

According to media analysts, TIFC is valued at Rs 250 crore and if Viacom18 buys the company, both Viacom Inc and IBN18 will bring in Rs 125 crore each. It is expected that Viacom18 will acquire the 19.4 per cent free floating shares and Network18's holding of 80.4 per cent in TIFC will be an all-cash deal.

Network18 has indicated that if the proposed offer provides beneficial exit from the film business to its shareholders, the company and its affiliates will consider tendering their respective shares to the offer.

"After acquiring TIFC, it will be subsequently delisted from AIM. One of the reasons that Viacom18 is interested in buying TIFC is because it runs the general entertainment channel Colors. The films produced by TIFC will come to Colors and it will be beneficial for the company," said a Mumbai-based research analyst who did not want to be named.

"This possible offer is in the process of being formulated and subject to a number of pre-conditions, will only be made if and when all such pre-conditions are satisfied and will be made in full compliance of the UK Takeover Code and other regulations," Viacom18 said in the release.

The nine films TIFC released during the financial year ended March, lost money at the box office. These included: Shortkut - The Con is On, Luck, Life Partner, Fruit 'N' Nut, London Dreams, Rann, Striker, Road Movie and Hum Tum Aur Ghost.

TIFC had earlier given blockbusters like Jab we Met, Welcome, Golmaal Returns, Singh Is Kinng and Ghajini. Two films from the portfolio with debutant directors Sooni Taraporwala (Little Zizou) and Amrit Sagar (1971) got critical recognition and received National Awards.