» Business » Rahejas, Star to sell 15% in Hathway to ChrysCapital

Rahejas, Star to sell 15% in Hathway to ChrysCapital

May 24, 2007 10:09 IST
The Rahejas and Star TV are together selling 15 per cent in cable network operator Hathway Cable to private equity firm ChrysCapital.

The sale consideration is estimated at around $60 million (around Rs 245 crore), thus valuing the closely-held company at $400 million (around Rs 1,640 crore).

ChrysCapital is buying around 11 per cent from the Raheja's and another 4 per cent from Star TV, which holds a 26 per cent stake in the company. Star TV had invested $75 million for the stake.

Following ChrysCapital's entry, Raheja's stake will be reduced to about 63 per cent, while Star TV's stake will come down to 22 per cent.

A source close to the deal confirmed that ChrysCapital was picking up a stake in Hathway Cable, though he refused to divulge further details.

Hathway Cable has operations in 13 cities. The other large players in the business are Hindujas' Incable Net and the Essel group's Wire and Wireless India Ltd.

This is the second private equity deal in the television signal distribution business in recent times. In January this year, Singapore-based Temasek Holdings had bought 10 per cent in TataSky, a joint venture between the Tata group and Star TV, for Rs 250 crore.

The deal comes at a time when the battle between CAS and direct-to-home players is hotting up. Companies offering the two platforms are going all out to lure prospective consumers with promotional schemes and a variety of hardware financing options, which require deep pockets.

ChrysCapital manages funds worth $1 billion through four funds.

Reena Zachariah in Mumbai