Sahara May Acquire Digicable
Sahara India is planning to acquire majority stake in Jagjit Singh Kohli and Yogesh Shah's Digicable Network, to foray in into cable television distribution sector, reinforcing its TV interests.
The transaction will provide exit to Ashmore Investment Management which had invested R41Cr for a 49% stake in 2007. The fund also has stake in Kohli’s broadband venture, Broadband Pacenet.
The transaction will be a two-way process. Steller Interactive Media Pvt Ltd, the parent company through which Kohli and Yogesh Shah hold their stakes in Digicable and Broadband Pacenet, will first buyout Ashmore with the support of Sahara. Steller Interactive Media, after taking full ownership of Digicable, will then sell majority stake to Sahara.
Ashmore Investment owns 49% stake in Broadband Pacenet India, which controls 51% of DigiCable, and 49% stake in DigiCable taking its ownership to 74%. The fund has invested $240 Mn in both the business since 2007.
In 2010, RCom was planning to merge its DTH and IPTV business with Digicable Network, but the deal did not get the regulatory approvals as the information and broadcasting ministry restricted cross-holdings in cable and DTH companies to 20%.
Digicable provides cable TV distribution and broadband services. In 2008, it acquired 51% in Kolkata-based CableComm Services Pvt. Ltd to expand in the eastern region. The company has about 8.7 Mn subscribers and offers digital feeds of 500 TV channels on its platform. It has a strong presence in Punjab, Uttar Pradesh, Madhya Pradesh, Rajasthan and Chhattisgarh.
Sahara operates a Hindi general entertainment channel Sahara One and a clutch of news channels under the Sahara Samay brand name.
The Government is eyeing to digitalise cable network in India before December 2014. As per the plan, the four metros are to be digitalized by June 2012 whereas other cities with more than 10 lakh population will have digital cable network by September 2014.
The ministry had set a deadline for complete digitalisation of cable services in the four metros by July 1 but had to defer it to November 1 as cable operators claimed that sufficient numbers of STBs had not been installed.
Other operators in this segment includes - InCable Net owned by the Hinduja Group, Hathway Cable and Datacom Ltd, DEN Networks Ltd and Wire and Wireless India Ltd from the Zee Group.
To read more on India Cable TV Industry click here.
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