Birla may use personal money for buy, Mail Today may now launch editions in Mumbai, other metros

19 May,2012

The Aditya Birla group investments may help India Today invest in launching editions of its newspaper Mail Today in Mumbai and other metros.


By A Corresdpondent


Kumar Mangalam Birla, chairman of Aditya Birla Group, has bought a 27.5% stake in Aroon Purie-controlled Living Media India, the publisher and owner of India Today magazine and Aaj Tak television channel. Mr Birla will use his personal money to invest in the New Delhi-based group, which straddles the entire media chain, from television to magazines to tabloids.


A statement from the metals-to-retail group said Birla has agreed to join the Living Media group as a financial investor. It did not specify the price for the deal or the valuation.


However, investment bankers close to the transaction said the deal has been finalised for Rs 600-700 crore, valuing the media group at Rs 2,400-2,800 crore. Mumbai-based investment bank Ambit Corp was the advisor to the deal.


This is the second big investment by an industrialist in the media space. In January, affiliates of Reliance Industries agreed to buy a large stake in the companies of Raghav Bahl, the promoter of Network18 and owner of channels such as CNBC-TV18 and CNN-IBN. The investment was worth over Rs 1,500 crore.


TV Today is listed on the stock exchanges, but it is not clear whether Birla’s personal investment companies will now have to make an open offer to buy 26% from public shareholders.


The financial investment also marks the realisation of Kumar Mangalam Birla’s cherished dream of owning a media company. “The media sector is a sunrise sector from an investment point of view. I believe that Living Media India offers one of the best opportunities for growth and value creation,” Birla said in a release.


Birla made an unsuccessful entry into the entertainment space by launching a movie and TV production company, Applause Entertainment, in 2003. The company, which produced the acclaimed movie Black , was closed down in 2009 after the downturn in the entertainment industry sparked off by the global recession.


Living Media will use the cash from the deal to expand its presence in media. It may now look at launching its New Delhi-based tabloid, Mail Today, in other metros, including Mumbai, according to persons close to the company.


Source:The Economic Times

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