MUMBAI: Even before INX Media completes a year of operation, its flagship Hindi general entertainment channel 9X seems to have run into trouble. It is learnt that the company is in talks with Balaji Telefilms to divest a significant stake. Although there is no clarity on how much stake in 9X has been put on the block, the promoters are targeting a valuation of $120-150 million for the channel from the stake sale, according to insiders. Sources close to the development confirmed that the talks were on between the parties. There is a possibility that Balaji may buy a majority stake in the channel, sources added. However, the two parties will take a while to reach a conclusion on the exact size of the stake and the price. Sources added that any possible transaction would take time, as INX Media would have to spin off the channel into a separate entity prior to the sale. Besides 9X, INX Media runs a music channel — 9XM. The promoters — Indrani and Peter Mukherjea — together hold a 50% stake in INX Media. The remaining stake is held by private equity firms — Temasek Holdings, New Silk Route, New Vernon Private Equity, Kotak Mahindra Capital and Srei. When contacted, Balaji Telefilms CEO R Karthik said: “We don’t comment on market speculation.” Mr Mukherjea also declined to comment on the issue. Sources said the possible acquisition would make sense for Balaji, which has always harboured ambitions of getting into the broadcasting space. It shares good relations with Mr Mukherjea as well. “Therefore, a partnership between Balaji and Mr Mukherjea may work,” they added.
The promoters of INX Media are not happy with the channel’s performance, since it has failed to live up to expectations, especially after the entry of Colors. Its visibility has fallen. The channel has been steadily slipping on the ratings chart too. The promoters now need funds for 9X, sources added. The second tranche of fund infusion from the promoters has been delayed. Mr Mukherjea’s relationship with Balaji’s promoters goes back a long way. In fact, the former STAR India CEO was instrumental in mobilising STAR’s investment in Balaji four years ago. Today, Balaji is one of the key content providers for 9X. The past one year has witnessed the entry of three new general entertainment channels. Besides 9X, former STAR CEO Sameer Nair launched NDTV Imagine, and the most-recent launch has been Viacom-owned Colors, which is headed by Rajesh Kamat.