Hindujas to invest Rs 500 cr in media biz
The exercise by the Hinduja Group is part of plans to consolidate cable, internet and content businesses under a single entity.india Updated: Oct 09, 2006 22:39 IST
With diversified business interests, the Hinduja Group today announced a first phase investment of Rs 500 crore into their media venture with plans to consolidate cable, internet and content businesses under a single entity.
While we prepare to merge all media assets, this investment, earmarked for the next 12 months, would be utilised against expanding existing businesses and strategic acquisitions across the entertainment sector into content business of production and distribution, Hinduja TMT Ltd Co-Chairman Ramkrishan P Hinduja told reporters in Mumbai.
Additionally, with its experience in content distribution the company would explore opportunities in cinema exhibition in the format of cineplexes, he said. The foray could be through acquisitions or building new theatres.
With the first phase of conditional access system (CAS) roll out round the corner, the company, out of the total investment of Rs 500 crore, will utilise about 20-30 per cent in acquiring set top boxes to meet the upcoming demand.
In the first phase of the CAS roll-out, we will provide set top boxes to customers in South Delhi and Mumbai, Hinduja said adding the distribution will start early January, 2007.
The company currently has a stock of 150,000-200,000 set top boxes and expects demand to rise after the CAS implementation begins.
On acquisitions, Hinduja said talks were in advanced stages with different companies both domestic and international. "The acquisition will be through a mix of debt and equity but we are not buying out cable operators," he clarified.
"Instead of buying operators we are partnering with them by offering equity stakes at an attractive price to existing MSOs and also to operators willing to align their network with the company," he said.
For the subsequent Phase II and III of expansion, the Group may also look at roping in a strategic investor to meet capital demand. "The strategic investor will not necessarily mean the money but also a value addition to our business," he said.
The Rs 160-crore business of the group currently operates in 14 cities and according to rough estimates has a customer base of 55 lakh cable television customers serviced by 2,000 operators.
As the second phase of CAS has outlined 35 cities to be covered by 2010, Hindujas will expand the network in 21 more cities for a wider network.
First Published: Oct 09, 2006 22:39 IST