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March 2019

TATA SKY TO SELL STAKE



Nearly three years after the Tata's failed attempt to list Tata Sky through an IPO, the DTH platform's financial investors want to cash in their chips through a stake sale.

The Singapore government's investment firm Temasek Holdings & Tata Opportunities Fund, which together control 19% of the DTH satellite TV distributor, have initiated a formal process to find a buyer for their shares. They have valued TataSky at $2.75-3 billion (₹ 20,000 Crore), according to press reports. Morgan Stanley is the adviser.


TataSky Has Valued Itself @ ₹ 20,000 Crores



FINANCIALS

FY 18 revenue was ₹ 5,735 crore, an annual growth of 7.6%.

Profit before exceptional items and tax was ₹ 160 crore, against a ₹ 17-crore loss in FY17. TataSky made losses in FY16 and FY17, while EBITDA margins have been 25% to 30% from FY15 to FY18.



TATASKY SHARE HOLDING

Temasek was among the earliest investors in TataSky, 2007 and has stayed invested. Tata Opportunities Fund came on board in 2013. The company was incorporated in 2004 as an 80:20 joint venture between the Tata Group and Rupert Murdoch's 21st Century Fox (now sold to Disney).

The agreement between Tatas & Sky has been that Murdoch would have the option to up his stake, if Indian laws permitted larger FDI holdings. Accordingly, Tata's stake has been declining over the years while Fox raised it by 10%.

Tata Sons currently owns 51% of the venture and the Walt Disney Co has 30% after it bought out Fox from Murdoch in December 2017.

Disney does not own any distribution business worldwide & has decided to stay invested in TataSky.

Depending on final offers, Temasek and Tata Opportunities Fund may decide to partially exit, according to speculation in the press.

With 17.7 million subscribers, Tata Sky is the secondlargest Indian DTH platform, after DishTV-Videocon. n