MUMBAI: In a strategic move, Zee Telefilms Ltd. (ZTL) has agreed to acquire a 50 per cent stake in the Dubai-based sports channel, Ten Sports. The investment is based on an enterprise value of $114 million (about Rs. 513 crore).

Commenting on the acquisition, ZTL Chairman Subhash Chandra, in a press release, said, "this acquisition is an important step for Zee towards consolidation in the media industry. We are confident that this will add a significant value for the shareholders of Zee. The acquisition of a stake in Ten Sports not only gives us a strong foothold in the arena of sports broadcasting across Asia but also strengthens our operations in West Asia.'

Following this move, Taj TV's Ten Sports financial statements will be consolidated on a line-by-line basis in Zee's books. Taj TV's average annual revenues for the next three financial years will stand at about $50 million, while the average earnings before interest and depreciation and taxation will be about $14 million.

Zee Sports and Ten Sports will be able to draw significant synergies from each other in operating in the Asian market place. Moreover, this move would consolidate the number of sports broadcasters in India, thereby bringing about a price correction in the burgeoning rights fees for various sports properties, according to the release.

"The addition of Ten Sports gives us a significant strength enabling further effective exploitation of all our sports properties. The operational synergies between Zee Sports and Ten Sports would be tremendous and we should be able to run the two channels at much better economies of scale,'' said Himanshu Mody, Business Head, Zee Sports.

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