Subhash Chandra-pro noted media conglomerate Zee Entertainment EnterprisesBSE -0.13 % is in advanced stages of discussion t buy 9X Media broadcast network that owns a clutch of Hindi regional music channels.
Zee is interested in acquiring 9X Media currently owned by private equity fund New Silk Route, “at a right value” as it makes a lot of strategic sense for the company, people close to the development told ET.
“For Zee, acquisition of 9X Media makes a lot of strategic sense.They have a motion pictures business, a full-fledged broadcast network, a music company and now FM radio, under its belt,” one of the sources said on condition of anonymity. “Zee has always been a prudent buyer and 9X Media has been on the block for a long time.Zee will acquire it if the value is right,” the person said.
Sources did not disclose any likely valuation for the proposed deal, but a media analyst said the `right valuation’ for Zee could be less than `. 220 crore that Sony Pictures Networks India (SPN) had agreed to shell out for 9X Media last year before the talks fell through.
New Silk Route (NSR), which owns close to 80 per cent stake in 9X Media, has been looking to exit since 2013 as it first invested in the company, then known as INX Media, over 10-years back.
Industry experts believe that for New Silk Route, the sale of the media firm is about cutting its losses.
An NSR spokesperson declined to comment, saying that the company does not comment on market speculations.
A 9X Media spokesperson also declined comment. Himanshu Mody, head of group finance & strategy at Essel Group, did not reply to ET’s calls and text messages as of press time on Wednesday.
9X Media operates three music channels in Hindi -9XM, 9X Jalwa, and 9X Bajao -one in each in English (9XO), Marathi (9X Jhakaas) and Punjabi (9X Tashan). It also has a digital product, SpotboyE, offering Bollywood’s news, gossip, movie reviews and other updates.
Last year, Sony had signed a letter of intent (LoI) with 9X Media to carry out due diligence, as ET reported then. However, after the due diligence, some legacy taxation issues were discovered, which could not be sorted out and SPN decided to walk out of the negotiations, sources said.
Source: Economic Times