Zee Entertainment Enterprises Ltd (ZEEL), India’s largest media company, is set to acquire 9X, the Hindi general entertainment channel belonging to the loss-making INX Media Pvt Ltd. The deal is expected to cost Zee about Rs 65 crore.
Zee and INX officials were not available for comment. For Zee, the synergies from the deal are unlikely to be significant from a content and viewership point of view, but there could be implied tax benefits, besides an additional channel licence in times of tight government approvals. INX has racked up huge losses that, on a carry forward basis, are expected to touch over Rs 800 crore by the end of the current fiscal year for its entire media business.
9X owes around Rs 130 crore to creditors, who are expected to take a substantial haircut and okay the transfer of ownership. The INX management is expected to pitch in with some money of their own over and above the Zee funds to seal the deal with the creditors, who are expected to agree considering the options they have. INX is then expected to spin off 9X, which will be taken over by Zee after a court approves the arrangement.