India Media Fund to raise $150m

The private equity fund will use the proceeds to make investments across the media sector straddling verticals such as broadcast, movies, theme parks, multiplex, out of home media as well as print.

The fund aims at offering international investors controlled access to India’s fast-growing media market. Running the fund will be former Star India executive Andrew Carnegie and UTV chief Ronnie Screwvala, who has been appointed as the chairman of the advisory board.

The funds are expected to be fully invested in the next 12-18 months, giving more impetus to the media sector. The fund is expected to be making infrastructure investments, both in retail as well as the exhibition sector.

The fund’s AIM listing will ensure that its corporate governance is good, but one cannot rule out co-investing with Mr Screwvala in the future, a source said.

The recent past has seen a spate of activity among private equity players, including UK based 3i, Blackstone, Warburg Pincus, Capital International, Citigroup taking a keen interest in media.

Despite the recent slowdown in the US economic growth and concerns about its effects on other markets, the long-term picture for entertainment and media spending remains bright

The ability of global media players to distribute their product/content throughout the world are making media companies stronger and better able to provide advertisers with effective platforms to reach consumers.

The last three months have seen a deal frenzy, with India TV receiving $11.5 million from ComVentures Arm FUSE+Media and Blackstone investing $275 million In Ramoji Rao’s Ushodaya Enterprises.

Similarly, Nimbus Communications, which came into limelight after winning the Indian domestic cricket rights for $612 million in February 2006, won the largest private equity deal in the Indian media and entertainment sector.