The promoters of media company Jagran Prakashan Ltd have consolidated their holding under a privately held firm, Jagran Media Network Investment Pvt Ltd, thus completing the second leg of their transaction with private equity giant Blackstone. The promoter group entity, which was earlier called Jagran Media Network Pvt Ltd, had announced in April last year that it would raise Rs 225 crore from Blackstone to consolidate its business and look at acquisition opportunities.
Blackstone's investment in the private firm of the Jagran Prakashan promoters was approved last September by foreign investment promotion board(FIPB), the nodal body monitoring foreign direct investment in India.
The exact quantum of stake, to be held by Blackstone in the holding company, stands undisclosed.
The Jagran Group, which publishes the largest-selling Hindi news daily Dainik Jagran, had kicked off the transaction through a series of bulk deals on the stock exchange early this month. Till June 30, 2011, the promoter group’s shares, totalling around 60 per cent stake, were held by various family members of Jagran’s CEO & MD Mahendra Mohan Gupta.
According to a disclosure made to the exchanges, Jagran Media Network Investment Pvt Ltd has acquired 59.46 per cent stake in the firm. The series of transactions have been done at a share price ranging between Rs 124.05 and Rs 117.5, putting the value of the share transfers between Rs 2,200 crore and 2,300 crore till date.
Jagran Prakashan stock was trading at Rs 111.9 per share on Friday (July 15) at 2:06 pm, down 2.23 per cent over the previous day’s closing. The scrip had earlier hit a 52-week high of Rs 148 and a low of Rs 105 per share.
Last year, a month after securing an investment from Blackstone, Jagran had acquired the publishing business of Mid Day in a stock transaction worth Rs 173.5 crore. The publishing business included the afternoon newspaper Mid Day, Sunday Mid Day and Gujarati Mid Day, besides the largest read Urdu daily, The Inquilab, and the website.
The transaction diluted Jagran Prakashan’s equity base by 4.7 per cent.
Jagran Prakashan reported 29.6 per cent increase in consolidated revenues for FY11 at Rs 1,221 crore, with net profit at Rs 210 crore.
See our earlier report.