Zee Media acquires 80% stake in two India Today Group companies1 min read . Updated: 29 Feb 2016, 12:10 AM IST
Zee Media has acquired stake in Today Merchandise and Today Retail Network
New Delhi: Zee Media Corp. Ltd on Saturday said it is entering the television shopping business by acquiring a stake in two India Today Group companies.
In a filing to BSE Ltd, the company which operates Zee News and Zee Business channels said it has bought 80% stake in Today Merchandise Pvt. Ltd (TMPL) and Today Retail Network Pvt. Ltd (TRNL). Both TMPL and TRNL are subsidiaries of Living Media India Ltd, which owns the India Today Group of publications.
The target companies are developing infrastructure for launching a television shopping channel and operate e-commerce website baggittoday.com to complement the TV shopping business. In 2014-15, TMPL posted a turnover of ₹ 3.84 crore, down 26% from ₹ 5.25 crore, a year ago, while TRNL posted a turnover of ₹ 37.36 crore, a 28% decline from ₹ 52.45 crore a year ago.
“TV shopping with its promising potential holds great investment value for the company. With its investment in the target companies which have built the infrastructure for the TV shopping channel along with a complementing website, the company will be able to not only shorten the launching time of the TV shopping channel but also be able to scale up a faster pace. The company with its existing broadcast operations will also be able to drive the synergy benefits from this proposed investment," Zee Media said in a BSE filing.
The investment will be made in tranches. By June, Zee Media will acquire 49% stake in both the companies by investing ₹ 39.78 crore by subscribing to equity shares of both companies and gain managerial and operational control over them.
“Subsequently, the company shall increase its stake by investing up to ₹ 126 crore over four years subscribing to any security convertible into equity shares of both companies, at par value," the filing said.
Today Retail Network Pvt. Ltd was incorporated in 2007 and Today Merchandise Pvt. Ltd was set up in 2010. Both companies are based out of New Delhi.