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Hinduja Ventures to up stake, values IMCL at Rs 3,445 cr

MUMBAI: Hinduja-promoted IndusInd Media & Communications Ltd (IMCL), which owns and operates cable TV business under InCablenet and In Digital brands, is valued at Rs 3,445 crore (Rs 34.45 billion).

IndusInd Media & Communications LtdHinduja Ventures Ltd (HVL) has got the approval of its board to purchase shares of IMCL at this value. After the transaction, HVL will up its stake in the subsidiary company from 56.09% to 61.91%.

HVL will pay Rs 200.5 crore (Rs 2.01 billion) to acquire 43,03,000 shares of IMCL from another Hinduja company, Grant Investrade Ltd (GIL). This will increase HVL’s stake by 5.82%.

The transaction will take place at a premium of Rs 456 per share, thus valuing IMCL at Rs 3,445 crore. The indicative date for completion of the acquisition is 20 July.

HVL will also purchase 7,03,60,000 preference shares (constituting 26.02% of IMCL’s paid-up preference capital) of IMCL at par value from GIL. HVL will thus pay Rs 70.36 crore (Rs 703.6 million) for this transaction.

After these two transactions, GIL will receive fresh capital of Rs 270.86 crore (Rs 2.71 billion).

A wholly owned subsidiary of HVL, GIL runs the headend-in-the-sky (HITS) business under the NXT Digital brand. It has set up a state-of-the-art broadcast facility in Noida.

NXT-tech-logo_DIGITALHinduja Ventures chairman Ashok Hinduja had earlier announced an investment of Rs 5,000 crore (Rs 50 billion) to support the HITS project that would enable independent multi-system operators (MSOs) and local cable operators (LCOs) to transition from analogue to digital cable systems.

IMCL posted a turnover of Rs 434.41 crore in FY16, down from Rs 455.27 crore (Rs 4.55 billion) a year ago. In FY14, the company’s revenue stood at Rs 566.70 crore (Rs 5.67 billion).

As of 31 March 2016, the company’s net worth stood at Rs 139.20 crore.

IMCL, which houses the company’s cable TV and broadband business, has demerged its broadband business into Planet E Shopping, which is an associate company of HVL. The broadband division was demerged in favour of Planet E Shopping on a slump sale basis for a sale consideration of Rs 267 crore (Rs 2.67 billion) under a scheme that has been approved by the Bombay High Court. This took place in FY16.

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