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Zee Entertainment sells 3% stake in Asianet, pockets Rs 290 mn
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Zee Entertainment Enterprises Ltd (Zeel) has sold its 3 per cent stake in Asianet Communications, pocketing Rs 290 million from an old investment that it had made in 2000.

The deal values Asianet Communications, which runs a clutch of popular Malayalam channels, at Rs 9.66 billion. It is not clear, however, whether the deal in 2000 had any buyback price clause.

“Zeel exited Asianet Communications with this stake sale of 3 per cent and pocketed Rs 290 million,” said a Zeel executive who did not want his name to be revealed.

In 2000, Zee had announced it would acquire a 51 per cent stake in Asianet Communications, valuing the deal at Rs 4 billion, to be paid for in shares of Zee Telefilms Ltd. But the deal broke off Subsequently, Asianet landed in the hands of Star India in 2008 by diluting Rajeev Chandrasekhar's stake.

Zeel is also looking at launching niche channels. “We may have a few channel launches this fiscal which have a low cost structure. But all will depend on market conditions,” the executive said.

The company is considering the launch of movie channels in the regional space. There are no near-term plans, though, to enter the Hindi movie production business, the executive added.

Zeel feels the only gap in its bouquet is a kids channel but has not firmed up plans to launch it. The company is open to taking the acquisition route, particularly if an opportunity throws up for snapping up distressed assets like 9X.

Zeel expects its losses from sports business, which includes Ten Sports and Zee Sports, to stay within last fiscal’s figure of Rs 580 million. In the current fiscal’s first quarter, the company had posted a revenue of Rs 832 million while costs stood at Rs 1.18 billion.

Zeel has a net cash of Rs 7.92 billion while its gross debt stands at Rs 800 million.

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