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Big TV in talks with Carlyle, Providence for funds
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NEW DELHI: BIG TV, a pay-TV company owned by Anil Ambani’s Reliance Communications, is in advanced talks with private equity firms Carlyle Group and Providence Equity to sell a minority stake and raise capital, according to two persons familiar with the situation.

Deutsche Bank has the mandate to facilitate the deal for the direct-to-home (DTH) TV service provider, said the first person, adding that Big TV is looking to divest about 20% in tranches, of which 10% will be sold now for around $50-75 million.

Carlyle has emerged as the frontrunner to clinch the deal, the second person, an executive in the media industry and with knowledge of the situation, said. A spokesman for Big TV declined to comment when contacted by ET. Carlyle Group Md Rajeev Gupta said: “In all investment evaluation situations, we are bound by confidentiality agreements. We would violate the confidentiality contracts if we commented in any way on any situation.”

An email sent to Providence Equity MD Biswajit Subramniam remained unanswered. A senior R-ADAG official, who asked not to be named, said Big TV needed between Rs 1,500-2,000 crore for its expansion purposes. While foreign funds can own up to 49% of the company, it is most likely to dilute its equity in stages. Current government rules restrict FDI in an Indian DTH operator at 20%. However, it can raise more from foreign institutional investors.

Big TV has some 1.8 million subscribers, almost a third of market leader Dish TV’s user base, which could give it a valuation of around Rs 1,200 crore, based on a mathematical extrapolation of the subscriber base and the valuation multiples enjoyed by its listed larger rival.

Dish TV, controlled by media entrepreneur Subhash Chandra’s Zee group, has some 5.07 million users, and at Friday’ s close, had a market value of Rs 3,709 crore.

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