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Aion Capital to buy controlling stake in PlanetCast Media; Kubera to exit for $22.5 mn
MUMBAI: Aion Capital Partners is acquiring a controlling stake in PlanetCast Media Services, formerly known as Essel Shyam Communications, for an undisclosed amount.
UK-based Private equity firm Kubera Partners will exit from PlanetCast Media while the other shareholders including affiliates of the Essel Group and the Shyam Group will dilute stake, a source said.
Aion Capital will initially acquire 51% stake and it will have the option to increase its stake in PlanetCast Media, the source added. The plan is to subsequently buy out the stake of the others (Essel Group, etc) excluding the management team.
Kubera is selling its stake for $22.5 million. In 2008, Kubera had invested $17 million for a 41% stake in Noida-based Planetcast in the form of a primary investment and a secondary purchase of shares from certain existing shareholders. The company also had issued warrants to the PE firm worth $5 million.
Kubera’s current shareholding in PlanetCast could be in the region of 30%, the source said.
Planetcast provides solutions for media broadcasting like teleporting, content management, play outs and mobile connectivity via DSNG vans and satellite communications industries. The company services 240 television channels including that of Star India.
Founded in 1996 as a joint venture between Subhash Chandra’s Essel Group and Shyam Telecom, PlanetCast Media Services reported net profit of Rs 43.2 crore on an operating income of Rs 248.1 crore in FY2016. In FY15, the company had posted net profit of Rs 33.5 crore on an operating income of Rs 210.4 crore.
Aion is an India-focused fund established by an affiliate of Apollo Global Management together with ICICI Venture Funds Management Company Ltd. The Aion Fund, with approximately $825 million in committed capital, is currently one of the largest private equity funds in India.
Following the acquisition by the Aion Fund, PlanetCast will continue to be led by the current management team.
“We are excited for the Aion Fund to acquire PlanetCast. We believe PlanetCast is a market-leading franchise that delivers best-in-class digital media solutions to its customers. We look forward to working with PlanetCast’s talented and dedicated team to continue the business’s strong heritage of innovation and customer satisfaction,” said partner at the Aion Fund Utsav Baijal.
“We are pleased to have sponsored PlanetCast during this period of significant growth and transformation. PlanetCast’s foundation as a leader in the broadcasting services industry positions the company well for its new ownership under the Aion Fund,” said PlanetCast promoter Jawahar Goel.
PlanetCast executive director MN Vyas said, “We are grateful to our existing shareholders for all the support and guidance to date and look forward to our relationship with the Aion Fund.”
This represents the second transaction the affiliates of Apollo Global Management, LLC have done with the Essel Group—they had invested $100 million in Dish TV in 2009 and successfully exited that investment in 2015.