Mumbai, Jun 18 (UNI) The Kubera Cross-Border Fund Limited (KUBC), an investment company traded on the AIM market of the London Stock Exchange, today announced that it has entered into a definitive agreement, to acquire a significant minority interest in Essel Shyam Communication Limited (ESCL), for an investment of up to USD 22 million (including the pro rata investment by affiliates of Kubera Partners, LLC, the Investment Manager of KUBC).
The timing of the closing is subject to obtaining regulatory approvals and satisfying other customary closing conditions. The transaction is expected to close by July 2008. This is Kubera's seventh transaction in India.
The media industry in India is expected to continue its high growth over the next few years, with the launch of several new channels. In addition, satellite based communications and VSAT are expected to grow with increased government spending. ESCL is well positioned to capture these opportunities. It is the only company in the country, with a comprehensive portfolio of services across satellite based communications and broadcasting, and amongst the few in South Asia to have the capability to execute on media infrastructure projects.
ESCL has had an impressive track record of growth, with over 35 per cent top line and bottom line annualized growth rates, over the last two years. The company intends to use the funds to expand its teleporting infrastructure to serve its fast growing customer base.
The company will also look for meaningful cross border acquisition opportunities.
The initial USD 17 million KUBC investment takes the form of a primary investment and a secondary purchase of shares from certain existing shareholders. KUBC will also be issued warrants to invest an additional USD 5 million in the Company. ESCL was advised by Centrum Capital Limited for this transaction.
Commenting on the new partnership, Lalit Jain, Director of ESCL, said, ''We were looking for a partner that apart from providing capital for growth, can work closely with us in building a global business. Kubera's track record and their ability to add value in a cross-border setting was very attractive to us.'' Ramanan Raghavendran, Managing Partner at Kubera Partners, LLC said, ''We believe that the media outsourcing business will experience tremendous growth over the coming years in India and in global markets. ESCL has a strong team and long standing customer relationships, allowing it to capitalize on growth opportunities in India as well as globally.'' UNI VK SR AG1711