Time to merge in media & entertainment space

The total investment in this industry plummeted to Rs 1,547.7 crore

Consolidation, not investment, was the dominant story of the media and entertainment (M&E) industry in 2016. That is what the numbers News Corporation’s VCCEdge put together for Business Standard suggest. 

The total investment in media and entertainment plummeted to $231 million (Rs 1,547.7 crore) or just about one per cent of all private equity and other investment deals in 2016. It is also the lowest in past four years. However, mergers and acquisitions went up. One of the biggest M&A deals in media – the $1.12-billion (about Rs 7,500 crore) Dish TV and Videocon d2h merger – happened last year. The other is $385 million  (Rs 2,600 crore) that Sony Pictures Networks paid to acquire Ten Sports from Zee. 

The other thing the figures throw up is that only some segments of the Rs 1,15,700-crore Indian M&E industry are driving substantial investor activity. The biggest deals are in TV broadcasting, TV distribution and film exhibition. While there is a lot of fund-raising in digital, the sizes are small — commensurate to the size of the segment – it is just about Rs 6,000 crore in revenues. The one segment which doesn’t really stand out in this data, but should in 2017 and 2018, is radio. It should see a lot of action as the lock-in period for old licences comes to an end and many of the smaller players sell out.