New Delhi: Zee Media Corporation will acquire up to 80 percent stake in India Today group's loss-making e-commerce and TV shopping entities Today Merchandise and Today Retail Network Pvt Ltd for Rs 165.78 crore in staggered payments over the next four years.
"The board of directors of the company has approved in-principle, acquisition of 80 percent equity stake by the company in both Today Merchandise Pvt Ltd (TMPL) and Today Retail Network Pvt Ltd (TRNL)," Zee Media Corporation said in a BSE filing.
"The target companies, which are currently in losses, have been developing infrastructure for launching a 'TV Shopping' channel and also operating an e-commerce website www.Bagittoday.Com to complement the TV shopping business."
The investment will be made in tranches. By June, Zee Media will acquire 49 percent stake by investing Rs 39.78 crore by subscribing equity shares of both companies and have managerial and operational control over the target companies, it said.
Subsequently, the company shall increase its stake by investing up to Rs 126 crore over 4 years subscribing to any security convertible into equity shares of both companies, as par value, that upon conversion, the shareholding of the company shall be 80 percent of fully-diluted capital of TMPL and TRNL.
Explaining its rationale for investing in the ventures, Zee Media said TV shopping holds great investment value and with this acquisition, the company will shorten the launch timing of TV Shopping channel.
"The company with its existing broadcast operations will also be able to derive synergy benefits from this proposed investment," it added.