Anil Ambani’s Reliance Group & Prime Focus promoters buy 16% in open offer for $40M

Anil Ambani-led Reliance MediaWorks (RMW) and its associated firms along with Malhotras of Prime Focus have acquired 16.10 per cent additional stake in the open offer to the shareholders of the Mumbai-based visual entertainment services firm for Rs 250.3 crore ($40.2 million), as per a stock market disclosure.

Simultaneously, RMW completed the acquisition of 11.3 million shares through an agreement it signed in July 2014. Prime Focus is holding an EGM next month to complete a previously proposed preferential allotment worth Rs 240 crore of which both RMW and Malhotras would give bring Rs 120 crore each to get a combined holding of around 79.8 per cent.

The partners, who joined hands for a multi-tiered transaction last year, acquired around 4.8 million shares in the recently concluded open offer.

RMW, earlier known as Adlabs Films Ltd, which was acquired by Anil Ambani led group from Manmohan Shetty a few years ago, announced a merger of part of its business with Prime Focus as part of the first leg of the transaction. A part of the fresh allotment of shares to RMW comes as a part of this deal.

Prime Focus, which is backed by Standard Chartered Private Equity besides ace private investor Rakesh Jhunjhunwala, provides creative and technical services to the film, broadcast and advertising market. It provides pre-production to final delivery services like 2D-to-3D conversion, video and audio post-production and digital distribution, among others.

Shares of Prime Focus were trading at Rs 51.95 each, up 19.98 per cent on BSE in a strong Mumbai market on Monday at 2.49 PM.

RMW is majority owned by Anil Ambani-controlled Reliance Group with minority holding by its public listed financial services arm Reliance Capital. It was recently delisted.

Reliance Group has a number of separate private firms in the media and entertainment space straddling areas like movie production, multiplex and direct-to-home services.

It also delisted another listed media firm Reliance Broadcast Network Ltd (RBNL) early last year. RBNL is a media entertainment firm with operations across radio, television, TV production and intellectual properties.

RBNL houses radio FM network under 92.7 BIG FM besides a string of television broadcast properties, including BIG CBS Networks (JV with CBS Studios offering English entertainment channels - Love and Prime, as well as a regional channel Spark Punjabi), BIG RTL THRILL (action programming channel under a JV with Europe's RTL Group), BIG MAGIC (local language general entertainment channel which has also expanded to international markets targeting the diaspora). In addition, RBNL has a television content production division and a media sales unit under BIG Connect.

(Edited by Joby Puthuparampil Johnson)

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