VCCircle.com acquired by HT Media from News Corp

HT Media which publishes Hindustan Times, Hindustan and Mint newspapers among other properties, said its board has approved the acquisition of Mosaic Media Ventures from News Corp, which own properties including VCCircle.com and others for an investment of up to Rs 6 crore after working capital adjustment, and revenue-linked milestones payment of up to Rs 1 crore on a deferred basis, to acquire Mosaic Media.

The acquisition comes five years after Mosaic Media was acquired by News Corp. News Corp has not issued a statement yet but the transaction is believed to have been triggered by a change in India’s foreign investment norms for digital media businesses announced last year. The move restricted foreign investment in digital news media to 26%, in line with the FDI policy for print news publications. Prior to this rule there was no specific restriction on foreign investment in the digital news media business. This had allowed NYSE-listed News Corp to buy 100% of Mosaic Media in March 2015 from its founder and other private investors.

In a stock-exchange disclosure, HT Media termed the acquisition as a “strategic investment” to drive synergies across businesses. It said that it expects VCCircle and Techcircle to augment the editorial capabilities of its business daily Mint’s technology and deals content. HT Media would use its reach to augment VCCircle’s events business as well as scale up the database and research business and unlock cost and revenue synergies.

The acquisition is expected to be completed by the end of next month.

HT Media said its board approved an investment of up to Rs 6 crore after working capital adjustment, and revenue-linked milestones payment of up to Rs 1 crore on a deferred basis, to acquire Mosaic Media. It didn’t share further details on the actual enterprise value of the firm. Shares of HT Media gained 2.24% to close at Rs 12.30 apiece in a weak Mumbai market on Wednesday.

HT Media

Part of the KK Birla group, HT Media is a publicly listed company that houses the English media publications of the group and is the parent of a separately listed company that publishes Hindi newspaper Hindustan. It also has a clutch of digital properties and runs an FM radio business through Fever 104 FM, Radio Nasha and Radio One.

HT Media reported consolidated net revenue of Rs 2,104.7 crore for the financial year ended March 2020 with a net loss of Rs 217.4 crore. This compares with revenue of Rs 2,193.8 crore with a net loss of Rs 26.9 crore for the previous year.

The company's listed subsidiary Hindustan Media Ventures Ltd generates over a third of its overall revenue and is a profitable business, having churned out a net profit of Rs 116.3 crore for 2019-20. Hindustan Media Ventures counts private equity firm ChrysCapital as a minority shareholder.

News Corp's India exposure

For News Corp, the deal with HT Media scales down its exposure to India. The company had acquired or invested in four digital properties between 2014 and 2017. Besides acquiring Mosaic Media, it had picked up a minority stake in real estate portal PropTiger and bought BigDecisions, a content-driven platform that aimed to help users make better investment decisions.

At the time of acquiring Mosaic Media, News Corp chief executive Robert Thomson had said the investment was a sign of the company’s faith in India’s future.