India: Sony acquires Zee’s TEN Sports for $385m

Pedestrians are reflected in a logo of Sony Corp outside its showroom in Tokyo, Japan, June 23, 2015. REUTERS/Yuya Shino

Zee Entertainment Enterprises Ltd (ZEEL) on Wednesday announced the sale of its sports network TEN Sports to Sony Pictures Network (SPN) in an all cash deal for $385 million.

TEN Sports portfolio includes TEN 1, TEN 1 HD, TEN 2, TEN 3, TEN Golf HD, TEN Cricket and TEN Sports. The network operates these channels across India, Maldives, Singapore, Hong Kong, Middle East, and Caribbean.

In a filing to the Bombay Stock Exchange on Wednesday, ZEEL said that the board of directors of the company has approved the sale and transfer of Zee’s sports broadcasting business to SPN. TEN Sports network is currently held by company’s two wholly-owned subsidiaries—Taj Television Limited, Mauritius and Taj Television (India) Pvt. Limited.

“This is a landmark deal for Zee,” said Punit Goenka, managing director at Zee Entertainment Enterprises Limited, adding that this deal is a step towards a strategic portfolio shuffle and a part of growth in their general entertainment business (domestic and overseas).

“While we have grown our sports business over the last 10 years through acquisition of content at competitive prices, our focus now is on transforming ourselves into an all-round media and content company comprising of five verticals—broadcast, digital, films, live events and international business,” said Goenka.

Completion of the acquisition is still subject to regulatory approval. The transaction is expected to close in four-five months.

N.P. Singh, chief executive, SPN welcomed the move, saying that the acquisition will strengthen Sony’s sports offering. “The acquisition of TEN sports network will strengthen SPN’s offering for viewers of cricket, football and fight sports, complementing our existing portfolio of international and domestic sporting properties,” he said.

Sony’s current sports properties include cricket (IPL, CPL, Ram Slam), football (FIFA 2018 World Cup Russia, UEFA Euro 2016, FIFA World Events including FIFA U-17 World Cup 2017 in India, European and South American Qualifiers for FIFA WC 2018, FIFA Confederations Cup, LaLiga, Serie A, FA Cup, Copa America Centenario, International Champions Cup), tennis (Australian Open, ATP 1000 and 500 World Tour Events, Champions Tennis League), fight sports (TNA, UFC, Pro Wrestling League), basketball (NBA) as well as NFL and Premier Futsal.

As for TEN Sports, the network holds broadcast rights to major cricket boards (South Africa, Pakistan, Sri Lanka, West Indies and Zimbabwe).

In addition, TEN Sports has rights to wrestling (WWE), football (UEFA Champions League, UEFA Europa League, French League, English Football League Cup), tennis (WTA Events, ATP events), golf (European Tour, Asian Tour, Ryder Cup, US PGA Championship, LPGA Tour, Professional Golf Tour of India and Golf Channel Block), athletics (Asian Games, Commonwealth Games), motor sports (Moto GP) and cycling (Tour de France) events.

“I am sure that this deal will add a lot to Sony’s sports bouquet. It is a business fit for Zee to get out from sports and focus more on their entertainment space,” said Tuhin Mishra, co-founder of Baseline Ventures, adding that Zee’s sports portfolio has been a little draining for last few years.

“It has been eating out of their profits,” said Mishra. For the year 2015-16, Zee’s sports broadcasting business contributed Rs.631 crore, about 10.79% of the consolidated revenue of the company. The business registered a loss of Rs.37.2 crore in 2015-16.

A top official at a consultancy firm who did not wish to be named said that it does not make sense for Zee to continue with the sports business. “ This deal will allow the company to focus on its strengths that is general entertainment,” the official said.

In July, ZEEL had reported a 21.4% increase in net profit for the quarter ended 30 June, backed by an increase in advertising and subscription revenue. The company registered a net profit of Rs.218.1 crore, up from Rs.179.6 crore in the year-ago period.

Also Read:

India Digest: ZEEL to sell Ten Sports; TerraPay buys Pay2Global; Stayzilla new VP

This story was first published on livemint.com

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In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

Following vacancies can be applied for (only in Singapore).

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  • A reporter to track companies/startups that have raised private capital, and have the potential to become unicorns. SEA currently has over 40 companies with a valuation of over $100 million and under $1 billion.
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