NEW DELHI: Investment deals are rare during the economic slowdown, and the media sector is no exception. So, the buzz that Temasek and India Equity Partners were together picking up more than 19% in the Lokmat group lifted many spirits.
But, not for long. Soon it was clear that the deal was off due to the prevailing “economic conditions”.
Devendra Darda, executive director of the Lokmat group of newspapers, told DNA Money that “both parties have mutually decided to call off the deal due to the current economic condition.”
Darda said, “They felt that the money may not be used very efficiently in these conditions.” Gaurav Mathur, managing director of India Equity Partners, refused to comment.
It is learnt that Temasek Holdings, the sovereign wealth fund of the Singapore government, and India Equity Partners, a private equity fund, were to jointly invest Rs 163 crore for a 19.5% stake in the Lokmat group through a two-tiered transaction.
This would have valued the Lokmat group at around Rs 853 crore. While Temasek was to invest Rs 128 crore, India Equity Partners was to put Rs 34.8 crore. The deal would have involved issue of fresh shares and a partial sale by the Darda family, who are the promoters of Lokmat. The proposal for the deal was being processed for moving the Foreign Investment Promotion Board, sources said.
Unconfirmed reports said the finance ministry may have had concerns over the way deal was structured. Finance ministry officials were not available to comment on this.