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Zee ups its stake in Ten Sports to 95 per cent

By afaqs! news bureau , afaqs!, New Delhi | In Media Publishing | January 20, 2010
Zee Entertainment Enterprises, which owned 50 per cent stake in Taj TV Mauritius, has acquired another 45 per cent stake from the Bukhatir Group

Zee Entertainment Enterprises Limited (ZEEL), in a board meeting, has approved the move of acquiring an additional 45 per cent stake in its subsidiary Taj TV, Mauritius, from the Dubai-based Bukhatir Group.

So far, ZEEL had 50 per cent stake in Dubai-based Taj TV, which it had acquired for $114 million in 2007. Taj TV owns Ten Sports, a sports channel beamed across India, West Asia, Pakistan, Sri Lanka, Bangladesh and Hong Kong.

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Besides, ZEEL has also acquired an additional 50 per cent stake in its subsidiary, Taj Television (India), which handles the distribution and ad sales for Ten Sports India. Taj Television India is now a wholly owned subsidiary of ZEEL. ZEE group also owns a dedicated sports channel, Zee Sports.

Together, the all-cash deal was worth $44.15 million.

Talking to afaqs! about the deal, Atul Pande, chief executive officer of the sports business of Essel Group says, "We felt that we needed more than one channel in the sport genre. Now, with Zee Sports and Ten Sports under our wing, there will be a lot of synergy in the content being shown on both the channels. Also, rather than both the channels showing the same sport, there will be more product-based streaming, which means that each channel would focus on specific sports allocated to it, and not all the sports."

He adds that the group is looking at introducing niche and high-end sports on one of the two sports channels. Each channel will continue to have dedicated teams working on it.

Taj TV holds the rights to air over 100 days of international cricket every year, through cricket properties such as the Pakistan Cricket Board, Sri Lanka Cricket Board, West Indies Cricket Board, South Africa Cricket Board and Zimbabwe Cricket Board. Ten Sports also holds rights to the UEFA Champions League Soccer, WWE wrestling, US Open Tennis and Hockey World Cup.

In a statement to the Bombay Stock Exchange (BSE), Subhash Chandra, chairman, ZEEL, says, "Positive steps continue to be taken by industry players and regulators for a fast growing pay television market. With an estimated two million plus DTH households being added across the country during the quarter, signs are that digitisation continues at a heartening pace. I am confident that the Indian television industry will witness a paradigm change in the way business is conducted and will change for the better."

ZEEL reported consolidated revenues of Rs 5,309 million in the third quarter of FY2010. The consolidated operating profit for the third quarter of the present financial year has been reported at Rs 1,573 million.

Chandra adds, "Zee's performance over the last couple of quarters is reflective of its ability to grow viewership and revenues, even under difficult market conditions. Now that the economy and sentiments have improved, we will continue building our product portfolio for creating value in the long-term."