Biyani to pick up 4.9% in Dish TV
Kishore Biyani’s Indivision Capital, the private equity arm of Future Capital, announced that it would buy 4.9 per cent in Subhash Chandra’s direct-to-home (DTH) business Dish TV for Rs 250 crore.
Dish TV will raise the money in two tranches. The board has approved a preferential allotment of 12.5 million equity shares of Re 1 each at a price of Rs 100.
The company will raise Rs 125 crore through this allotment. The price paid for the shares is at a 6 per cent premium over the closing stock price of Dish TV at Rs 94.25 today.
Indivision will also subscribe to 9,615,385 warrants, which will be converted into equity at Rs 130 a share, 18 months later. The agreed price is again at a premium of 27.5 per cent over today’s closing price.
The company has a market capitalisation, based on today’s closing, of Rs 4,035.79 crore. Based on what Biyani is paying, the company has been valued at Rs 5,102 crore.
The cash will be raised primarily to fund Dish TV’s expansion. “We intend to raise over Rs 1,000 crore in the next two years for our growth strategy,” Arun Kapoor, CEO, Dish TV, told Business Standard.
Currently, the direct-to-home service provider has around 2.6 million subscribers — a market share of 67 per cent of the 3.9 million subscribers in the market.
Kapoor said Dish TV aims to add over 1 million subscribers each year, and by March 2011, hopes to have around 8 million subscribers.
As of now Dish TV has a presence in 4,300 towns and in the next two years it plans to operate in 1,500 to 2,000 more towns.
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