Talks on for a possible 20-25% buy; Raghav Bahl looking for Rs 250-crore valuation, say sources.
Thomson Reuters is set for a major expansion in India. The global news agency has started discussions with media baron Raghav Bahl to acquire a minority stake in his news agency, NewsWire18 Pvt Ltd.
Thomson Reuters, which faces tough competition from rival Bloomberg, has been looking for an inorganic route to expand in India. A lack of buyout targets kept the plan on hold for a while, say sector experts.
According to banking sources, Reuters is eyeing a 20-25 per cent stake in NewsWire18. Bahl is looking for a valuation of Rs 250 crore for the Indian news agency. Ambit is believed to be running the sell mandate.
NewsWire18 Ltd is part of the Network18 Group. NewsWire18 was formed when Television18 acquired the staff and business of Crisil MarketWire Ltd (CMW) from credit rating and research agency Crisil Ltd in 2006. CMW was the new avatar of the erstwhile Bridge News. The core team of journalists from Bridge News shifted to Crisil in 2001, when the news agency closed shop in India and formed CMW.
According to its website, NewsWire18 has more than 100 editorial staff across nine bureaus. NewsWire18 publishes Money-Wire, EquityWire, Commodity-Wire, and FundWire.
An email to the Network18 spokesperson did not elicit a response. A Thomson Reuters spokesperson in India said, “We are not in any position to respond to market speculation.”
At present, Thomson Reuters has a content sharing agreement with ET Now, a business channel from Bennett & Coleman & Company, which publishes The Times of India and The Economic Times. The channel competes with CNBC-TV18, which is owned by Network18.
In recent years, India has emerged as a big frontier for multinational media companies, although the country’s laws prevent these from taking a significant stake in mainstream news publications and channels. Foreign direct investment (FDI) is currently limited to 26 per cent in the news segment.
“Increasingly, a lot of foreign news organisations want to cater to the Indian market, as they are aware about the standards they bring in and also that the readers here are hungry for content,” said Jehil Thakkar, executive director, media and entertainment at consulting firm KPMG India.
Reuters had recently launched a text messaging service for Indian farmers with news, advice on commodities and weather information, called Reuters Market Light. And, Bloomberg had opened an office in Mumbai this March. It has planned to triple the size of its strength here to accommodate increased customer support and an expanded news reporting operation. Bloomberg’s news channel also has a 16 per cent stake in Bloomberg UTV.
Also, the New York Times and Wall Street Journal have launched websites for the Indian market.
The Network18 Group, one of the largest media conglomerates in India, has two listed entities, Network18 Media and Invest-ments Ltd, holding company of the entire group, and TV18 Broadcast Ltd, which owns the broadcasting and news assets. TV18 Broadcast has four national news channels: CNBC-TV18, CNBC Awaaz, IBN7 and CNN-IBN. It also owns 50 per cent in IBN Lokmat, a Marathi news channel, and a similar 50 per cent in Viacom 18, which runs Colors, Nickelodeon, MTV, VH1 and Viacom 18 Motion Pictures. Apart from this, Network18 owns HomeShop18, different web properties and holds stakes in different companies and ventures like yatra.com.