Zee bags Ten Sports in Rs 256-crore deal
Strengthening its position in sports broadcasting, the Subhash Chandra-promoted Zee Telefilms has acquired 50% stake in Dubai-based Taj TV, which owns Ten Sports, in an all-cash deal of Rs 256.5 crore. The investment is based on an enterprise value of approximately Rs 513 crore.
Zee launched its own sports channel, Zee Sports, in September 2005. It has aggressively bid for the telecast rights of major sports events since then. The announcement comes at a time when the International Cricket Council (ICC) is scheduled to evaluate bids for telecast rights to cricket matches after the 2007 World Cup.
Ten Sports has separate beams for West Asia, Pakistan, Sri Lanka, Bangladesh and Hong Kong. Together with the Indian presence of Zee Sports, the combination is now a pan-Asian sports broadcaster.
Zee Group chairman Subhash Chandra said, “This is an important step towards consolidation in the media industry. It not only gives us a strong foothold in the arena of sports broadcasting across Asia but also strengthens our operations in West Asia.” Chandra had in September this year acquired majority stake in domestic wire service United News of India for Rs 32 crore.
The Zee scrip rose 3.33%, or Rs 11 to close at Rs 341.65 on Monday on the BSE.
• A new company will be formed with a seven-member board
• The new board to have 4 members from Zee and 3 from Taj TV
• Zee will now be able to strengthen operations in the Middle East
• Both Zee Sports and Ten Sports will function independently for now
Ten Sports has telecast rights for matches organised by the Pakistan Cricket Control Board, Sri Lanka Cricket Board and the West Indies Cricket Board. These rights, combined with Zee Sports’ neutral venue rights bought from the Board of Control for Cricket in India, create the single largest repertoire of cricket programming.
Taj TV’s financial statements will be consolidated in Zee’s books from the next quarter. Taj TV’s average annual revenue for the next three financial years is estimated at $50 million. Sources close to the deal said a new company would soon be floated with a seven-member board. Four will be from Zee and three from Taj TV.
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