Silver Eagle soars 14% on Nasdaq after Videocon d2h stake buy

US-based Silver Eagle Acquisitions is up 14 per cent on the Nasdaq since January, when it had announced a deal to invest $303 million in Videocon d2h for a 33 per cent stake.

The shares issued by Videocon will be represented by American Depositary Shares (ADS) and will be distributed directly to Silver Eagle's stockholders. Silver Eagle was trading at $11.2 a share on Friday, with a market capitalisation of $455 million, according to Bloomberg.

A Nasdaq listing is crucial for the Indian pay television (TV) operator, as it provides a valuation to the company's 33 per cent stake even as it prepares to list its shares on Indian stock markets. The deal is expected to close this month, according to a banker.

Videocon d2h's rivals Dish TV had a market value of Rs 8,965 crore, Sun TV Network Rs 16,512 crore, and Hathway Rs 4,414 crore on Friday. After the transaction and the distribution of ADS, Videocon d2h will be a publicly held corporation and the company intends to apply to list the ADS on the Nasdaq under the ticker VDTH. Silver Eagle's Chief Executive Officer Harry Sloan and President Jeff Sagansky will join the board of Videocon d2h. Sloan had earlier served as chairman and chief executive officer of MGM while Sagansky was part of the top management of CBS and Sony Pictures. Videocon d2h began operations in July 2009 and has grown to a gross subscriber base of 11.8 million and a market share of 16.5 per cent on September 30, 2014. For the six months ended September 30, 2014, Videocon d2h had 27.7 per cent and 26.1 per cent, respectively, of the incremental market share of the DTH subscriber base in India.