With the conditional access system (CAS) entering Indian homes, the Indian cable industry has become increasingly attractive for private equity (PE) players. PE firm India Value Fund Advisors (IVF) is close to picking up a majority stake in Bangalore-based Atria Convergence Technologies, which is a digital cable and broadband service provider.
Sources have confirmed the development stating IVF is in talks with Atria, which is looking at raising funds to roll out its services in other cities and bring in better digital technology. When contacted, Atria Convergence Technologies managing director Sunder Raju refused to comment. The IVF spokesperson could not be contacted.
However, industry sources believe that the company is looking at investments worth $150-200 million to expand its services. IVF Advisors has a corpus of $600 million. The broadcast distribution industry has been undergoing transformation since the introduction of CAS and DTH.
In the recent past, Orissa-based digital cable and broadband service provider Ortel raised Rs 60 crore by diluting 23% stake to Mauritius-based PE firm New Silk Route. Similarly, Jagjit Singh Kohli and Yogesh Shah- promoted Digicable Network (India) roped in the UK investment firm Ashmore Investment Management to take 49% in company for Rs 41 crore.
Industry players believe that the new technologies and regulations have led to corporatisation of the largely fragmented cable industry with biggies like Hathway and Wire & Wireless buying out smaller players. “Either the small players are raising funds to expand or looking at strategic tie-ups with the bigger pan-India players,” said a senior executive with a cable company.
Source: Economic Times