Post the closure of the transaction with Accel Partners, Network18 will continue to be the single largest shareholder in the company with a 40% stake
BestMediaInfo Bureau | Delhi | August 23, 2012
The Network18 Group announced that it has entered into an agreement to dilute its majority stake in Indiaâs premier entertainment ticketing website - Bookmyshow.com. This is in line with its stated objective of reducing stakes in digital and other non-broadcasting assets to create value for the Network18 shareholders and allow infusion of growth capital in these assets to propel them to the next stage.
Network18 was the majority shareholder in Bigtree Entertainment Private Limited, the holding company of the entertainment ticketing website BookMyShow.com, holding a 60% stake. Post the closure of the transaction with Accel Partners announced today, Network18 will continue to be the single largest shareholder in the company with a 40% stake. Accel Partners, one of the leading global investors in Internet businesses will invest INR 100 crores into the business. The secondary stake sale by Network18, post consummation will add Rs. 45 crores to Network18âs pre-tax profit.
Announcing the transaction, Raghav Bahl, Managing Director, Network18 said that, âAfter a phase of investment in building our digital and other non-broadcasting businesses, we believe that many of these assets have reached an inflection point and can now help in creating value for all our stakeholders. The dilution in one of our premier digital commerce assets â bookmyshow.com is a reflection of our commitment to profitably monetize these assets for the benefit of our shareholders and also facilitate the growth of these businesses to the next level. We are confident that the Indian Digital Story is just beginning and many of the digital commerce and content assets like bookmyshow.com, Homeshop18, the content properties under Web18 and the Capital18 investee companies; that we have nurtured over the past decade are now on track for the next phase of their growth journey.â
Commenting on the deal, Sai Kumar, Group CEO, said, âBookmyshow.com is today synonymous with entertainment ticketing and in many ways defines the genre. Besides movie and play tickets which remain a mainstay, the company is an exclusive ticketing partner for several leading sporting franchises in India including Formula 1 and the Indian Premier League (5 of the 9 franchises) .We take great pride and pleasure in having been a part of this wonderful growth story in the digital space. We will continue to partner with bookmyshow.com as they embark on the next phase of their journey and build the business in a manner that will befit one of Indiaâs best e-commerce teams. The digital teams across Network18 and I are very excited by the opportunity that the impending Indian digital revolution presents to us to create and monetize the promised value for all our stakeholders.â
The stake sale at Bookmyshow.com is the second in a series of asset monetization transactions by Network18. Earlier during the year, Network18 had profitably sold its stake in one of the Capital18 investee companies â NetworkPlay to Bertelsmann. The Network18 group operates a portfolio of digital content and e-commerce assets including moneycontrol.com, ibnlive.com, in.com, firstpost.com and HomeShop18.com. Network18 also holds a minority stake in Yatra â one of Indiaâs leading travel booking destinations.
On signing the deal, Ashish Hemrajani, Founder & CEO of BookMyShow.com said, âThe funding from Accel comes at an interesting inflection point in our journey and is a strong vindication of our efforts to create Indiaâs largest online entertainment ticketing platform. We look forward to leveraging Accelâs global Internet experience and Network18âs continued support to expand our footprint and help take our customer experience to the next level.â
Accel Partners has been one of the earliest global investors in Internet businesses with successful investments in companies like Facebook, Groupon, Rovio (Angry Birds), etc. The firm has continued its track record in India by partnering early on with some of the leading Internet businesses including Flipkart and Myntra.
Prashanth Prakash, Partner of Accel India said, âBookMyShow.com caught our attention because it has become synonymous with online entertainment and ticketing. We are constantly striving to invest in businesses that assume a leadership position by driving the definition and growth of their respective categories. We are very excited to add one of Indiaâs pre-eminent Internet brands to our portfolio of investments in India.â
Sameer Gandhi, Partner of Accel US further commented, âThe Internet is playing a crucial role in bringing goods and services to the masses in India and will produce the next generation of Indian consumer franchises. BookMyShow .com has demonstrated exemplary execution in creating a large online community, and in our view, has the potential to become the pre-eminent entertainment destination for India. We look forward to playing our part in helping the company realize that vision.â
Commenting on the transaction, Sarbvir Singh, Head Investments of Network18 said, âIn partnership, with the BookMyShow.com team, we have created a premier asset in the digital commerce space and built value for all stakeholders. We believe that Accelâs global Internet experience combined with the passion of theBookMyShow team will help the company take customer experience to the next level while continuing to build on its market leadership. The transaction has allowed us at Network18 to profitably monetize a part of our investment while allowing us to maintain a large position in the company to participate in the next phase of BookMyShow journey.â
Avendus Capital was the sole financial advisor to the transaction.