Tata Sky a DTH major which is a 80:20 JV between the Tata group and television network Star is considering a second round of funding of $150-200 million and is in conversation with various private equity players such as Providence, Carlyle, Blackstone, Goldman Sachs and Apax Partners.
By law, a DTH operator in India has to be have a minimum holding of 51% by an Indian entity. Singapore-based PE player Temasek had bought about 10% for about $56 million. The valuation of the company in three months has risen more than two-fold.
Tata Sky is looking at diluting about 10% stake. The current holding structure of Tata Sky looks like this: 20% with Star (FDI), 10% with Temasek (FII) and 70% with the Tata’s. Tata Sky’s fund-raising is timed to coincide with the proposed launch of Reliance Communications and Bharti’s DTH operations. In order to face the threat from Reliance and Bharti, Tata Sky needs to ramp up in terms of infrastructure and technology.
Read more in The Economic Times article.
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