U.S. media giant Turner will acquire Prannoy Roy-promoted NDTV’s entertainment channel, Imagine, for about Rs. 546 crore, a deal that will help Indian media group turn debt-free.
While NDTV’s 76 per cent stake in NDTV Imagine would be given to Turner for $67 million (about Rs.314 crore), the Time Warner company would acquire fresh equity worth $50 million to get 92 per cent control of the entertainment channel launched last year.
The deal is expected to help NDTV tide over the financial crisis, as is reflected in the Rs.86-crore loss posted by the group during the quarter ending September 2009.
“Turner International has signed an agreement in principle to acquire 92 per cent of NDTV Imagine, subject to regulatory and Time Warner Board approval,” Turner International India Pvt. Ltd. Managing Director Anshuman Misra said in a statement here.
“This deal will enable NDTV to become debt free at the consolidated level. It will also provide NDTV Imagine with enough funds for operations,” NDTV Networks Chief Executive Officer Vikram Chandra told PTI.
NDTV had debt of Rs. 112 crore as on March 31, 2009.
As part of the deal, NDTV, through its subsidiary NDTV Networks, will sell its 76 per cent stake in NDTV Imagine.
NDTV Networks will retain 5 per cent stake in the general entertainment channel before the issue of fresh shares. The company said the deal was subject to approval of Turner Asia Pacific Ventures’ parent Time Warner Inc.
Industry sources say the move is part of a four-stage restructuring plan being undertaken by the city-based broadcaster.