The Jagran group that publishes the country’s most widely read Hindi newspaper, Dainik Jagran, is close to buying out Nai Dunia, the Indore-based Hindi daily promoted by Vinay Chhajlani.
According to sources familiar with the development, the talks have been on for a while and the deal size is expected to be around Rs 300 crore.
Mahendra Mohan Gupta, chairman and managing director, Jagran Prakashan, did not respond to calls and text messages. Chhajlani, when contacted on the talks, said he was busy in a meeting. He did not take calls later on or respond to messages.
Nai Dunia was started in 1947 and is published from Indore, Gwalior and Jabalpur in Madhya Pradesh and from Bilaspur and Raipur in Chhattisgarh. If the deal goes through, Dainik Jagran would get an avenue to expand in Madhya Pradesh and central India. Currently, the Kanpur-based newspaper group has two editions in Madhya Pradesh, at Bhopal and Rewa. It is published from Uttar Pradesh, Uttarakhand, Punjab, Bihar, Delhi, Haryana, Jharkhand, Madhya Pradesh and parts of Rajasthan. It has 37 editions.
According to The Indian Readership Survey (IRS) Q4 report, released by the Media Research Users Council (MRUC) and Hansa Research, Dainik Jagran has average issue readership of 16.41 million, making it the most read publication across the country, while Nai Dunia has average readership of 1.64 million.
The 2012 Ficci- KPMG report on the media and entertainment industry says Hindi language dailies have a highly competitive market. Five of the country’s top 10 dailies are published in Hindi. The non-English press contributes 60 per cent of the industry’s revenue and caters to 89 per cent of readers. For the December quarter, Jagran posted a net profit of Rs 41.3 crore, with revenue of Rs 324 crore. On Tuesday, the scrip closed at Rs 97.4, down two per cent on the Bombay Stock Exchange.
In 2010, Jagran bought Mid Day, the afternoon tabloid based in Mumbai, from Tariq Ansari for Rs 200 crore in an all-stock transaction. The deal also included Sunday Mid-Day, Gujarati Mid-Day and the Urdu newspaper Inquilab, along with its website, mid-day.com.
The Blackstone Group, a private equity firm, holds an estimated 12 per cent of Jagran Media Network Investment Pvt Ltd, the holding company of Jagran Prakashan. It had invested Rs 225 crore in the company, which was used for expansion and acquisitions in print. Last year, it launched Punjabi Jagran and also extended the Urdu daily, Inquilab, to four new cities — Lucknow, Kanpur, Delhi and Bareilly.
|THE BIG FISH
The media business has seen major consolidation in the past year.
A look at the mega deals
(in Rs crore)
|UTV Software||Walt Disney||41 (additional)||1,600-1,800|
|Divya Prabhat Publication||DB Corp||60||Undisclosed|
|Timbre Media||Saregama Media||10||Undisclosed|
|Worldwide Media||Bennet, Coleman & Co||50||49|
|Indiagames||Walt Disney||30 (additional)||95|
|Scrabble Entertainment||UFO Moviez||26||200|
|Source: Companies, industry estimates|
Apart from Dainik Jagran, the group also publishes other newspapers, I-Next and City Plus.
Chhajlani, a printing technologist by profession, started his foray into business by setting up a software company, Suvi Information Systems. In 2009, a group of investors and he bought NewsX, an English news channel, from INX Media, promoted by former STAR India CEO Peter Mukherjea and his wife, Indrani. He is also believed to be in talks with Subhash Chandra’s Zee Network to sell his stake in NewsX, though the two have denied any talks.
There has also been speculation that Mukesh Ambani has invested in Nai Dunia, as well as his software company, in his independent capacity, a speculation the group has denied.