Silver Eagle Acquisition Soars With Stake in Videocon d2h Limited
Silver Eagle Acquisition Soars With Stake in Videocon d2h Limited
Silver Eagle Acquisition Corp. is a company founded by two well known entertainment executives. This American firm has been founded to create investments in media properties and announced its first deal on Monday, 5th January 2015. The company will invest USD 300 to 375 million in Videocon d2h Limited, which is a pay television operator in India which the American country hopes to take public in the US.
Stake for Silver Eagle
As concerning the deal, Silver Eagle will acquire a stake between 33.5% and 38.6% in Videocon d2h which is a division of corporate group Videcon Group. The latter is a Mumbai based company. Videcon d2h is one of the many pay television companies in India. There is television penetration to a very low degree in India but subscription services are in huge demand in homes which have television sets.Videocon d2H Limited is working to apply for a listing on the NASDAQ Stock Exchange following the closure of the deal with Silver Eagle.
Silver Is In. Gold Shines Bright Too
Silver Eagle was founded by former Metro Goldwyn Mayer Inc Chairman and CEO Harry Sloan and veteran senior television executive Jeff Sagansky. It has raised USD 325 million in 2014 as part of the initial public offering. Sagansky and Sloan also started Golden Eagle Acquisition Corp. in the year 2011 which has acquired in-flight entertainment companies such as Row 44. The efforts by Sloan and Sagansky are to invest in companies that are worth USD 1 billion. Shifting economic trends in India have attracted Silver Eagle, which has estimated that there will be 33 million new pay television subscribers over a period of the next 4 years.
About Videocon d2h
Videocon d2h commenced operations in 2009 and it has acquired a subscriber base of 11. 8 million and a market share of 16.5% of India’s Direct to Home market in September last year. It distributes a total of more than 500 digital television channels. Silver Eagle, a US-based firm said, it "will receive new equity shares of Videocon d2h initially valued at no less than USD 303.7 million representing no less than 33.5 per cent of the equity capital of Videocon d2h.”
Shares issued by Videocon will be represented by ADSs or American Depository Shares that will be directly distributed to stockholders of Silver Eagle. Through this deal, Videocon d2h will become the only US listed Indian Pay Television operator.
A Deal Which Stakes A Lot on Growth
Silver Eagle Acquisition Corp co-founder Jeff Sagansky has been quoted as saying "Videocon's DTH business is in what we believe to be the fastest growing segment of the media industry in India in part because of the government's ongoing mandatory digitisation plan in addition to millions of Indian homes subscribing to pay TV for the first time."
Videocon Group Chairman Venugopal Dhoot added "We anticipate that the transaction with Silver Eagle will not only give us additional capital to continue development of our services, but also unparalleled expertise and experience."
Following the completion of the transaction and distribution of the company’s stockholders of the ADSs, this company will be a publicly held corporation. As per the deal which was signed recently, the amount of cash to be contributed by Silver Eagle and the number of Videocon D2h shares to be issued will be based on and "will depend, in large part, on the number of public shares which the company's (Silver Eagle) stockholders elect to redeem in connection with the transaction.” Following closure of the deal, Sloan and Sagansky are expected to join the board of directors of Videocon d2h.
