Star sells 26% stake in Balaji Telefilms for $17M; Ekta Kapoor, Sameer Nair among buyers

Star India Pvt Ltd, a part of entertainment media major 21stCentury Fox, has exited its investment in Ekta Kapoor-promoted film and television production house Balaji Telefilms Ltd, by selling its entire 25.99 per cent stake for Rs 107.8 crore ($16.9 million).

It has sold 16,948,194 equity shares at a price of Rs 63.6 per share on the Metropolitan Stock Exchange on Wednesday. Bulk deal data reveal Balaji promoters Ekta and Shobha Kapoor (daughter and wife of yesteryear Bollywood actor Jeetendra) were among the buyers picking 4.36 per cent stake for Rs 18 crore in the process. The promoter holding in the company has now moved to 47.29 per cent.

Other buyers included high net-worth investors such as Radhakishan Damani. The buyers also included Sameer Nair, former chief of Star India, who picked some 4 lakh shares worth around Rs 2.5 crore.

Nair, who started his TV career in 1994 as director-producer for Star Movies, made his name as chief of Star Network where he served as COO and CEO over a period of time. In his role as programming chief in Star TV, he was responsible for revamping the network and launching the combination of quiz show KBC besides the Balaji daily soaps on Star Plus in 2000.

He later moved to join NDTV's new joint venture with Karan Johar's Dharma Productions as CEO. He was involved in launching the channel NDTV Imagine in November 2007. However, the channel didn’t do well and closed in 2012. Last year he joined.

Balaji Telefilms as group CEO.

Star's exit closes the long investment association with Balaji Telefilms. In August 2004, Star Group through its Dubai-based affiliate Asian Broadcasting FZ-LLC, had acquired 21 per cent stake in Mumbai based Balaji Telefilms for Rs 123 crore. The company had paid Rs 90 per share. Later, it increased its stake to 25.9 per cent through an open offer.

Interestingly, the share sale by Star was done at a sharp discount to the current share price. Balaji Telefilms scrip had shot up over the last few weeks after hovering around the Rs 65-70 a share mark.

Shares of Balaji Telefilms last traded at Rs 95.25 each, up almost 20 per cent on BSE in a strong Mumbai market on Wednesday.

Balaji Telefilms is one of the top listed television content and movie production companies, and has produced more than 15,000 hours of content in Hindi, Tamil, Telugu, Kannada and Malayalam since its inception in 1994.

It ended FY15 with revenues of Rs 342.6 crore against Rs 404.9 crore in the year ended March 31, 2014. It posted net profit of Rs 5.6 crore against a net loss of 17.19 crore the previous year.

Meanwhile, this comes as yet another deal in TV broadcast space in the country. Last month US-based media conglomerate Viacom Inc acquired 50 per cent equity stake in Prism TV Pvt Ltd, which runs five regional language general entertainment channels—ETV Marathi, ETV Gujarati, ETV Kannada, ETV Bangla and ETV Odia. Viacom, through Nickelodeon Asia Holdings Pte Ltd (Singapore), acquired the stake held by Shinano Retail Pvt Ltd, an arm of Mukesh Ambani-controlled Reliance Industries Ltd, by shelling out about Rs 940 crore (approximately $150 million).

For Star, this marks the fourth strategic move in the last one year in India. In February, Star India acquired Telugu television channel network of Maa TV for an undisclosed amount. Last year, it completed acquisition of Asianet Communications Ltd. Post that, it entered into an agreement to acquire the Indian Express Group's Screen brand, the weekly movie entertainment publication.

Although known for its Hindi language general entertainment channels besides the sports and movie channels, the company has a strong presence in regional broadcasting as well, through a bouquet of affiliate channels which includes Star Jalsha, Jalsha Movies, Star Pravah, Asianet, Asianet Plus, Suvarna, Suvarna Plus and Vijay.

Star India is part of Rupert Murdoch-controlled 21st Century Fox. Murdoch is also the promoter of News Corp, the owner of this news website.

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