| MUMBAI:
NDTV Ltd. has terminated its pact with US-based Scripps Networks Interactive for
selling majority stake in its lifestyle broadcasting company, providing room for
speculation that it would rope in a minority partner to keep alive its dream of
expanding outside its core television news business area.
NDTV would be
$30 million less without the deal but the English lifestyle broadcasting channel,
NDTV Good Times, has reached operational break even status in the final quarter
of the fiscal ended 31 March 2010.
NDTV
would still be sitting on a cash pile of around $30 million and be in a position
to infuse capital to expand the lifestyle broadcasting business, a growing segment
in India. NDTV
will also have room to rope in a minority partner to fund the business that includes
the launch of a food channel. When
contacted, NDTV Group CEO Narayan Rao refused to comment on the reasons for terminating
the agreement with Scripps and the growth plans for the lifestyle business. NDTV
had, in November last year, reached an agreement with Scripps to offload 69 per
cent stake in NDTV Lifestyle Ltd. The enterprise value of the deal was $55 million,
out of which NDTV would have taken home a cash of $30 million while $25 million
would have been pumped into NDTV Lifestyle. “NDTV
Good Times is not a high investment business and even without selling it to Scripps,
NDTV has a cash balance of over Rs 1 billion which it will utilise to expand its
offerings in the lifestyle genre. Though the lifestyle genre is small currently,
its growth potential can’t be undermined with the booming Indian diaspora.
By retaining NDTV Lifestyle, NDTV has retained a lever for growth,” said
a media analyst who did not want to be named. Scripps,
however, had come at a high valuation. The problem with NDTV would be to get a
similar kind of valuation in place, said another media analyst who works at a
leading broking firm. The
scrapping of the deal brings Scripps Networks’ plans to launch lifestyle
TV networks in India to a halt. Scripps
is the lifestyle-oriented content developer for television and the Internet. It
owns Food Network in Europe, the Middle East, Africa and Asia. | 
