Sports broadcasting in India is set for a new era of Big Two as Sony Pictures Networks moves to ink its biggest acquisition deal in the Indian market.
The deal will see Sony swallow the sports broadcasting business of Zee Entertainment Enterprises Ltd (ZEEL), housed under Ten Sports.
ZEEL is expecting the deal size to be about Rs 2,500 crore (Rs 25 billion). It will mark the exit of ZEEL from sports broadcasting, paving the way for Star India and Sony to wrestle for cricket, soccer and other rights. Cash-strapped Neo Sports, owned by Nimbus, will continue to be an almost-invisible third player, staying out of the big game.
“ZEEL is looking to sell Ten Sports to Sony for around Rs 2,500 crore.
The deal is in the final lap. Some issues like the period for non-competition are being ironed out,” a source familiar with the development said.
The non-compete clause will keep Subhash Chandra-promoted ZEEL out of sports broadcasting.
The period being discussed is anywhere between three and six years, the source added.
ZEEL admitted on Monday to having advanced negotiations with potential buyers for its sports broadcasting business.
In a filing with the stock exchanges, the company, however, did not give any specific details or timeline due to confidentiality reasons.
Mumbai Mirror had first reported that Sony was on the verge of buying Ten Sports for around Rs 3,000 crore (Rs 30 billion).
The Economic Times then reported that Sony was close to acquiring Ten Sports for Rs 2,000 crore.
On Monday, CNBC-TV18 reported that the deal could be announced this week.
So, why is ZEEL looking to shut the door on sports broadcasting? The loss from sports business for FY17 is expected to be under Rs 100 crore (Rs 1 billion).
For a company that reported an operating profit of Rs 1,509.6 crore (Rs 15.1 billion) and a net profit of Rs 1,028.9 crore (Rs 10.29 billion) in FY16, the sports loss can be easily absorbed.
Why then let go of an asset that can have strategic value?
Era of Big Two in sports broadcasting as Sony is set to swallow ZEEL-owned Ten Sports | TelevisionPost.com
The deal will see Sony swallow the sports broadcasting business of Zee Entertainment Enterprises Ltd (ZEEL), housed under Ten Sports.
ZEEL is expecting the deal size to be about Rs 2,500 crore (Rs 25 billion). It will mark the exit of ZEEL from sports broadcasting, paving the way for Star India and Sony to wrestle for cricket, soccer and other rights. Cash-strapped Neo Sports, owned by Nimbus, will continue to be an almost-invisible third player, staying out of the big game.
“ZEEL is looking to sell Ten Sports to Sony for around Rs 2,500 crore.
The deal is in the final lap. Some issues like the period for non-competition are being ironed out,” a source familiar with the development said.
The non-compete clause will keep Subhash Chandra-promoted ZEEL out of sports broadcasting.
The period being discussed is anywhere between three and six years, the source added.
ZEEL admitted on Monday to having advanced negotiations with potential buyers for its sports broadcasting business.
In a filing with the stock exchanges, the company, however, did not give any specific details or timeline due to confidentiality reasons.
Mumbai Mirror had first reported that Sony was on the verge of buying Ten Sports for around Rs 3,000 crore (Rs 30 billion).
The Economic Times then reported that Sony was close to acquiring Ten Sports for Rs 2,000 crore.
On Monday, CNBC-TV18 reported that the deal could be announced this week.
So, why is ZEEL looking to shut the door on sports broadcasting? The loss from sports business for FY17 is expected to be under Rs 100 crore (Rs 1 billion).
For a company that reported an operating profit of Rs 1,509.6 crore (Rs 15.1 billion) and a net profit of Rs 1,028.9 crore (Rs 10.29 billion) in FY16, the sports loss can be easily absorbed.
Why then let go of an asset that can have strategic value?
Era of Big Two in sports broadcasting as Sony is set to swallow ZEEL-owned Ten Sports | TelevisionPost.com
