In a move that signals the emergence of industrialist Mukesh Ambani as a media mogul, Reliance Industries Ltd (RIL) has acquired a controlling stake in Network18.
The media network, started by journalist-turned media baron Raghav Bahl, owns a slew of news, entertainment and e-commerce channels such as CNN-IBN, CNBC TV18, Colors and HomeShop18, online news portal Firstpost.com and e-commerce websites such as Yatra.com and Bookmyshow.com, as well as print properties such as Forbes India magazine.
During the tenure of group founder Dhirubhai Ambani, the Reliance Group had bought
Later, in 1991, it launched a sister publication, The Business and Political Observer . However, neither venture succeeded.
Mega investment RIL will now invest about ₹4,000 crore through Independent Media Trust (IMT), of which RIL is the sole beneficiary, to acquire 78 per cent stake in Network18 and 9 per cent in TV18.
This follows a similar agreement in 2012, when it inked an investment deal with Network18 to acquire a controlling stake in the media group.
Further, IMT will make an open offer to buy shares of NW18, TV18 and Infomedia Press Ltd, a move many industry experts feel will lead to the delisting of NW18.
The acquisition comes even as RIL’s telecom services unit Reliance Jio Infocomm gears up for 4G rollout.
The company, which had signed five tower-sharing agreements, is readying for launch by the year-end. “It is a huge positive for both RIL and Network18.
The latter gets deeper access into rural and semi-urban households in its digital commerce ventures,” said an analyst. Network18 has a suite of premier digital properties.
The deal is likely to help Reliance Industries give stiff competition to other telecom and media companies in terms of providing cheaper and faster digital content to broadband customers across the country.
Likewise, Network18’s web portals and e-commerce operations will provide several value-added services to RIL’s broadband subscribers.
Top-level exits In the run-up to the deal, there was an exodus of personnel from Network18 this week, starting with B Sai Kumar, who took over as group CEO in late 2011.
Kumar has also stepped down from the board of the group’s various joint ventures.
Network18 Group Chief Operating Officer Ajay Chacko, who had joined the firm nine years ago, and its Chief Financial Officer (CFO) RDS Bawa have also quit. Bawa had been with the group for more than 19 years.