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| Time Warner to acquire NDTV Imagine for $126.5 mn |
| Press Trust of India / New York Dec 17, 2009, 15:03 IST |
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Time Warner today said its board has approved the acquisition of Prannoy Roy-promoted NDTV's entertainment channel Imagine for $126.5 million (about Rs 592 crore).
"The acquisition will be made by Turner Asia Pacific Ventures, a Time Warner company, and Imagine will become a key part of Turner's operations in the Asia-Pacific region," Time Warner said in a statement.
Turner is investing a total of $126.5 million in this transaction, resulting in a 92 per cent stake in Imagine. It will invest $76.5 million for 87.4 per cent stake in Imagine from NDTV Networks Plc and another minority share holder. However, it did not disclose how it intends to acquire the remaining 5 per cent.
Besides, Turner would put in a further $50 million as primary capital infusion to fund business.
"India continues to be a key priority for us. Our accelerated pace of investment here underscores both our commitment to this dynamic market and our view of India's compelling long-term potential," Turner Broadcasting System Asia Pacific President Steve Marcopoto said.
Pursuant to completion of the deal, Imagine will continue to be led by Sameer Nair as Chief Executive Officer and would work in tandem with Turner's senior management. NDTV Chairman Prannoy Roy said following restructuring, "NDTV Group will be in a position to be cash-surplus and debt -free on a consolidated basis."
The sale by NDTV would also mark the conclusion of restructuring of its subsidiary, NDTV Networks Plc, Roy said.
The deal is expected to help NDTV tide over a financial crisis, as is reflected in the Rs 86-crore loss posted by the group during the quarter ending September 2009. As of March 31, 2009, NDTV had debts of Rs 112 crore.
Post conclusion of the deal, the remaining 8 per cent stake in Imagine will be held by the current management, ESOP holders and NDTV Networks Plc, the statement added. Bank of America Merrill Lynch acted as financial adviser to Time Warner on the deal.
Shares of Time Warner closed down 0.33 per cent at $30.04 on the New York Stock Exchange yesterday.
Meanwhile, shares of NDTV Ltd was trading at Rs 143.60, down by 0.21 per cent over previous close on the Bombay Stock Exchange.
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