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The acquisition viral is spreading across various segments: broadcasting, cable TV, DTH
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#1
Quote:God knows how the distribution map will shape up in India. Will cable merge with DTH to create mammoth entities? Or will Comcast and the multinationals step into the Indian market to create cable giants?

"We will see smaller deals dot the landscape now. But bigger deals are bound to happen in the next five years. The M&E sector can only grow through mergers and acquisitions," says Gandhi.

Media companies are not comfortable in doing large-sized deals yet. Zeel, for instance, acquired 9X as it gave them a tax benefit.

"Deals will happen as several companies run out of cash. Obtaining cash from the external market will be difficult for many players. New ventures will find it almost impossible to raise capital from private equity. The bigger media companies have a distinct advantage," says Zeel EVP corporate strategy and business development Atul Das.

Market leader Dish TV showed how it could raise capital after building scale in the DTH business. In late 2009, US-based Apollo Management took an eleven per cent stake in Dish TV for $100 million.

"The environment is not conducive to attract foreign investments into the media sector. In India there is very little transparency and the regulatory policies take their own sweet time. Investors no more look at virtual business models but the robust systems that you have built," says Dish TV managing director Jawahar Goel.

The DTH sector will see private equity participation once companies amass volumes. Reliance Big TV, for instance, could not attract investors at the value it wanted as it progressed as the fifth DTH operator - lagging behind Dish TV, Sun Direct, Tata Sky and Airtel digital TV.

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#2
Five years is the forecast for bigger acquisition till then growth of each sector needs to be focused.
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