balugudidiot
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RE: Videocon D2H to merge with Dish TV; serve 28 million subscribers
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Thakur
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RE: Dish TV is in the final stages of acquiring Videocon D2H
The Board of Directors of Dish TV and Videocon d2h Limited today approved a scheme of arrangement for the amalgamation of Vd2h into Dish TV. The proposed transaction is expected to close in the second half of 2017. - See more at: Videocon D2H to merge with Dish TV
The Board of Directors of Dish TV and Videocon d2h Limited today approved a scheme of arrangement for the amalgamation of Vd2h into Dish TV. The proposed transaction is expected to close in the second half of 2017. - See more at: Videocon D2H to merge with Dish TV
rahul1117kumar
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RE: Dishtv & Videocon Merger Updates
Dish TV-Videocon D2H merger to bring in cost synergies: Dhoot
Brining consolidation in the pay TV space, the
Nasdaq listed Videocon D2H will merge with Dish TV to form the largest pay TV operator with 27.6 million net subscribers.
The proposed transaction is expected to close in the second half of 2017. Dish-TV and Videocon will continue to be listed on the exchanges and the current promoters will continue in their roles.
Discussing the merger in detail, Saurabh Dhoot, Executive Director, Videocon told CNBC-TV18 that Jawahar Goel, Managing Director, Dish TV would be leading the combined entity. Goel has been a pioneer of the DTH sector in the country, said Dhoot.
Goel said the deal is a merger and not a buyout. He said, " The arrangement is and Dish TV promoter will have resultant equity holding of 36 percent and D2H promoter will get 28 percent and public will have 36 percent equity."
The combined entity would be called Dist TV Videocon Limited.
The plan is to continue with all the operational brands – Dish TV and Videocon D2H as distinct brands in the market, said Dhoot.
On the board composition, Dhoot said while the combined entity would be led by Jawahar Goel, the Dhoot family would have the right to nominate the Vice Chairman and the Deputy Managing Director – two members on the board.
“This merger is more about unlocking what more one can do in the satellite distribution space, “said Dhoot, adding that they are excited about the skill sets that both the companies would bring to the space.
“The merger will lead to significant cost synergies as well as enhance our ability to grow alternate revenue stream,” said Dhoot.
Below is the verbatim transcript of Jawahar Goel and Saurabh Dhoot's interview to Nisha Poddar on CNBC-TV18.
Q: Did you accept Videocon as a principalshareholder by choice - the market understanding was that this was going to be an acquisition by way of merger where Videocon promoters could have been squeezed out?
Goel: The arrangement of the scheme is merger and we never envisaged a buyout and Saurabh Dhoot is going to be the DMD of the company of merged entity after we had done the completion post all the permissions. This is what the arrangement is and Dish TV promoter will have resultant equity holding of 36 percent and D2H promoter will get 28 percent and public will have 36 percent equity.
Q: You will be the DMD of this newly formed company, what are being the dynamics of the deal and the valuation of the sale process?
Dhoot: The boards have approved to have a scheme of arrangement. The combined entity would be called Dish TV Videocon Limited. Dish TV shareholders would comprise of in terms of ownership of the new entity of 55.4 percent and so around 45 percent would be owned by Videocon D2H shareholders.
Q: Help us understand the equity valuation because Rs 7,200 odd crore is looking like is the equity valuation, while the enterprise valuation of the company Videocon D2H as per this transaction is Rs 9,000 crore on the higher side?
Goel: When we say that the Dish TV valuation is 55:45 ratio, so the rationale has been discussed by the board and presented by the consultant who has been engaged as specialist for the transaction. There are the criteria of whatever is the industry norm in Indian market and in media space globally, so the factor has been applied and we have to respect and obey the judgement of the consultant and the board.
Q: When we first reported this transaction in August, at that time the Nasdaq listed entity was sub USD 800 million in terms of market cap and now it did shoot up and the valuation of equity that you are pegging at for this particular acquisition is Rs 7,200 crore that is over a billion dollar it is on thehigher side?
Dhoot: I have not done the calculation to do the enterprise value (EV), but the Nasdaq we have never discussed this transaction so the Nasdaq shooting up to anything is definitely not a case from that perspective. In this case if you get very granular Dish TV shareholders would own something like 1066 million shares, Videocon D2H shareholders would own 857 million shares and this is an all stock combination swap ratio reflecting the relative values of each business across operating like financial and trading metrics. So subscribers and subscriber addition is factored in, revenue, earnings before interest, taxes, depreciation, and amortization (EBITDA) and growth is factored in and trading metrics are also factored in, so the combination combine Dish’ scale and profitability with D2H scale and growth and the scale and efficiency benefit emanating from such a combination will be a win-win for all stakeholders.
Q: What will be the combined debt of this merged entity because Videocon D2H comes with a large amount of debt as Dish generates a free cash flow of about Rs 400-500 crore and on the other hand Videocon has debts, so don’t think that Dish will be at a disadvantage with this kind of a deal?
Goel: Post merger which is our completion is around 7-8 months down the line will be around Rs 2,100 crore and EBITDA as reported in the last financial numbers in the past it is around Rs 1,800-1,900 crore. Now the question you had raised is the cost of debt. In terms of Dish TV we had fairly reasonable cost of debt and the debt will definitely will be the Dish TV debt, which will be coming at the same price or a better price going forward - - so the problem of high cost of debt should not be there.
Q: How much of a reduction in the finance cost are you anticipating by way of this merger?
Goel: Dish TV has its own rating and a practice and relationship, so this will as the completion happenswe will see and answer the question appropriately.
Q: Talking about debt component, since it is a merged entity you are going to be a partner in this combined entity. So, how much will be the debt reduction overall for Videocon group and going forward is there a chance of debt reduction as well because we thought that the whole idea of this deal emanated because of debt reduction from the point of view of the lenders?
Dhoot: We already have Videocon D2H and its equity. This combination is more about unlocking what more one can do with the satellite distribution space. I don\\'t think there are other drivers to it. For example I would say that we are very excited about the long term benefits of the skill sets that the two companies bring to the table. You can imagine that a DTH operator catering to over USD 25-30 million subscribers would benefit from huge scale advantages. The merger would lead to significant cost synergies as well as enhance our ability to grow alternate revenue streams like carriage, advertising, value added services, new channel launches and these are all highly margin accretive.
So the proposed combination shall create scale benefits for all stakeholders. There will be better growth opportunities for employees, sales and service networks, larger distribution network, but from an economic standpoint for our shareholders, which includes the existing Dish TV and Videocon D2H shareholders the merged entity will drive value unlocking from combine sourcing, purchasing, product development, improved distribution, customer service and net support, network and infrastructure consolidation and capex.
Q: What will be the operational synergy post the deal?
Goel: The detailing we have to do as the expert team will sit as and when it is permitted. We have to follow certain procedure. So at this moment we cannot express and then comment on your question.
Q: What about other operationalsynergies and also the technical hindrances that you may find because both the companies use different satellites?
Goel: I am a businessman, I must have analysed it but at this moment I cannot communicate. This is my personal view that the company and the expert team and the management of both the divisions they have to work out.
Q: Since both the companies are coming together the name is going to be a combined entity as well. So, how is the board composition going to be, how many boards will Videocon get in this?
Dhoot: Dish TV-Videocon would be, combining the strength of the senior and operating management team for both the combined company would be led by Jawahar Goel and the Dhoot family would have the right to nominate the vice chairman and the deputy managing director and two members on the Dish TV-Videocon board.
Q: How will you divide the work between the two groups? How is the work division going to look like for it to be a winning combination in the end?
Dhoot: Both the families - the Goel family and the Dhoot family are very closely associated since decade, this is really a family affair with the pioneer of DTH sector in the country itself was first launched by Jawahar Goel and he would be leading the combined company and the senior management of the combined company as chairman and managing director.
In terms of operations the important aspect is to continue all the operational brands mainly Dish TV and Videocon D2H as distinct brands in the market.
Dish TVVideocon D2H merger to bring in cost synergies: Dhoot
Dish TV-Videocon D2H merger to bring in cost synergies: Dhoot
Brining consolidation in the pay TV space, the
Nasdaq listed Videocon D2H will merge with Dish TV to form the largest pay TV operator with 27.6 million net subscribers.
The proposed transaction is expected to close in the second half of 2017. Dish-TV and Videocon will continue to be listed on the exchanges and the current promoters will continue in their roles.
Discussing the merger in detail, Saurabh Dhoot, Executive Director, Videocon told CNBC-TV18 that Jawahar Goel, Managing Director, Dish TV would be leading the combined entity. Goel has been a pioneer of the DTH sector in the country, said Dhoot.
Goel said the deal is a merger and not a buyout. He said, " The arrangement is and Dish TV promoter will have resultant equity holding of 36 percent and D2H promoter will get 28 percent and public will have 36 percent equity."
The combined entity would be called Dist TV Videocon Limited.
The plan is to continue with all the operational brands – Dish TV and Videocon D2H as distinct brands in the market, said Dhoot.
On the board composition, Dhoot said while the combined entity would be led by Jawahar Goel, the Dhoot family would have the right to nominate the Vice Chairman and the Deputy Managing Director – two members on the board.
“This merger is more about unlocking what more one can do in the satellite distribution space, “said Dhoot, adding that they are excited about the skill sets that both the companies would bring to the space.
“The merger will lead to significant cost synergies as well as enhance our ability to grow alternate revenue stream,” said Dhoot.
Below is the verbatim transcript of Jawahar Goel and Saurabh Dhoot's interview to Nisha Poddar on CNBC-TV18.
Q: Did you accept Videocon as a principalshareholder by choice - the market understanding was that this was going to be an acquisition by way of merger where Videocon promoters could have been squeezed out?
Goel: The arrangement of the scheme is merger and we never envisaged a buyout and Saurabh Dhoot is going to be the DMD of the company of merged entity after we had done the completion post all the permissions. This is what the arrangement is and Dish TV promoter will have resultant equity holding of 36 percent and D2H promoter will get 28 percent and public will have 36 percent equity.
Q: You will be the DMD of this newly formed company, what are being the dynamics of the deal and the valuation of the sale process?
Dhoot: The boards have approved to have a scheme of arrangement. The combined entity would be called Dish TV Videocon Limited. Dish TV shareholders would comprise of in terms of ownership of the new entity of 55.4 percent and so around 45 percent would be owned by Videocon D2H shareholders.
Q: Help us understand the equity valuation because Rs 7,200 odd crore is looking like is the equity valuation, while the enterprise valuation of the company Videocon D2H as per this transaction is Rs 9,000 crore on the higher side?
Goel: When we say that the Dish TV valuation is 55:45 ratio, so the rationale has been discussed by the board and presented by the consultant who has been engaged as specialist for the transaction. There are the criteria of whatever is the industry norm in Indian market and in media space globally, so the factor has been applied and we have to respect and obey the judgement of the consultant and the board.
Q: When we first reported this transaction in August, at that time the Nasdaq listed entity was sub USD 800 million in terms of market cap and now it did shoot up and the valuation of equity that you are pegging at for this particular acquisition is Rs 7,200 crore that is over a billion dollar it is on thehigher side?
Dhoot: I have not done the calculation to do the enterprise value (EV), but the Nasdaq we have never discussed this transaction so the Nasdaq shooting up to anything is definitely not a case from that perspective. In this case if you get very granular Dish TV shareholders would own something like 1066 million shares, Videocon D2H shareholders would own 857 million shares and this is an all stock combination swap ratio reflecting the relative values of each business across operating like financial and trading metrics. So subscribers and subscriber addition is factored in, revenue, earnings before interest, taxes, depreciation, and amortization (EBITDA) and growth is factored in and trading metrics are also factored in, so the combination combine Dish’ scale and profitability with D2H scale and growth and the scale and efficiency benefit emanating from such a combination will be a win-win for all stakeholders.
Q: What will be the combined debt of this merged entity because Videocon D2H comes with a large amount of debt as Dish generates a free cash flow of about Rs 400-500 crore and on the other hand Videocon has debts, so don’t think that Dish will be at a disadvantage with this kind of a deal?
Goel: Post merger which is our completion is around 7-8 months down the line will be around Rs 2,100 crore and EBITDA as reported in the last financial numbers in the past it is around Rs 1,800-1,900 crore. Now the question you had raised is the cost of debt. In terms of Dish TV we had fairly reasonable cost of debt and the debt will definitely will be the Dish TV debt, which will be coming at the same price or a better price going forward - - so the problem of high cost of debt should not be there.
Q: How much of a reduction in the finance cost are you anticipating by way of this merger?
Goel: Dish TV has its own rating and a practice and relationship, so this will as the completion happenswe will see and answer the question appropriately.
Q: Talking about debt component, since it is a merged entity you are going to be a partner in this combined entity. So, how much will be the debt reduction overall for Videocon group and going forward is there a chance of debt reduction as well because we thought that the whole idea of this deal emanated because of debt reduction from the point of view of the lenders?
Dhoot: We already have Videocon D2H and its equity. This combination is more about unlocking what more one can do with the satellite distribution space. I don\\'t think there are other drivers to it. For example I would say that we are very excited about the long term benefits of the skill sets that the two companies bring to the table. You can imagine that a DTH operator catering to over USD 25-30 million subscribers would benefit from huge scale advantages. The merger would lead to significant cost synergies as well as enhance our ability to grow alternate revenue streams like carriage, advertising, value added services, new channel launches and these are all highly margin accretive.
So the proposed combination shall create scale benefits for all stakeholders. There will be better growth opportunities for employees, sales and service networks, larger distribution network, but from an economic standpoint for our shareholders, which includes the existing Dish TV and Videocon D2H shareholders the merged entity will drive value unlocking from combine sourcing, purchasing, product development, improved distribution, customer service and net support, network and infrastructure consolidation and capex.
Q: What will be the operational synergy post the deal?
Goel: The detailing we have to do as the expert team will sit as and when it is permitted. We have to follow certain procedure. So at this moment we cannot express and then comment on your question.
Q: What about other operationalsynergies and also the technical hindrances that you may find because both the companies use different satellites?
Goel: I am a businessman, I must have analysed it but at this moment I cannot communicate. This is my personal view that the company and the expert team and the management of both the divisions they have to work out.
Q: Since both the companies are coming together the name is going to be a combined entity as well. So, how is the board composition going to be, how many boards will Videocon get in this?
Dhoot: Dish TV-Videocon would be, combining the strength of the senior and operating management team for both the combined company would be led by Jawahar Goel and the Dhoot family would have the right to nominate the vice chairman and the deputy managing director and two members on the Dish TV-Videocon board.
Q: How will you divide the work between the two groups? How is the work division going to look like for it to be a winning combination in the end?
Dhoot: Both the families - the Goel family and the Dhoot family are very closely associated since decade, this is really a family affair with the pioneer of DTH sector in the country itself was first launched by Jawahar Goel and he would be leading the combined company and the senior management of the combined company as chairman and managing director.
In terms of operations the important aspect is to continue all the operational brands mainly Dish TV and Videocon D2H as distinct brands in the market.
Dish TVVideocon D2H merger to bring in cost synergies: Dhoot
RE: Dishtv & Videocon Merger Updates
monoblock lnb are available even now with 8 degree.....
so 7 degree is not a problem......
i think only lnb need to be changed....with monoblock...and software of existing d2h will be changed to dishtv....
monoblock lnb are available even now with 8 degree.....
so 7 degree is not a problem......
i think only lnb need to be changed....with monoblock...and software of existing d2h will be changed to dishtv....
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RE: Dishtv & Videocon Merger Updates
I am using Dish TV monobkock LNB on Dish TV dish to get both Videocon D2H from ST2 satellite, Dish TV from NSS6/SES8 and DD free dish from GSAT15. So if the merged company decides to not use Asiasat anymore they just need to do the following.
For all Dish TV customers, move the dish to ST2 primarily and put monoblock to get Dish TV
For all D2H customers, change the dish to Dish TV parabolic dish (optional) and put monoblock LNB to get Dish TV too.
The only concern is set top box, software and decryption.
I am using Dish TV monobkock LNB on Dish TV dish to get both Videocon D2H from ST2 satellite, Dish TV from NSS6/SES8 and DD free dish from GSAT15. So if the merged company decides to not use Asiasat anymore they just need to do the following.
For all Dish TV customers, move the dish to ST2 primarily and put monoblock to get Dish TV
For all D2H customers, change the dish to Dish TV parabolic dish (optional) and put monoblock LNB to get Dish TV too.
The only concern is set top box, software and decryption.
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