Eros to acquire B4U channels

Eros PLC, the holding company of Eros Group that produces and distributes movies globally is in serious talks with B4U Television network that has channels.

NDTV has learnt that that B4U, which is co-promoted by steel magnate Lakshmi Mittal, is looking for a valuation of USD 150 million and if this deal goes through it will mark Eros's entry into the niche Bollywood channel genre.

B4U has channels like B4U Music and B4U Movies. The majority stake of B4U is held by steel baron Lakshmi Mittal and Gokul Binani. Eros currently holds 24 per cent stake in the channel and is planning a total buyout.

According to analysts, B4U is likely to be valued at USD 150 million. The due diligence is on and Eros is negotiating hard for an attractive buyout.

While Eros refused to comment on this specific development but it has affirmed that it is scouting for acquisitions.

"As part of our company policy we do not comment on market speculation. Thus would refrain on commenting on any such developments," the company said in reply to a query.

“We are constantly looking for mechanisms to improve our shareholder value and returns in the media and entertainment space,” Kamal Jain, CFO, Eros International had said.

Eros is keen to leverage the content it produces which includes a content library of over 1100 movies for better monetisation.

“The company has quite an underleveraged balance sheet and it will be in a comfortable position to fund the acquisition if it wants to,” said AK Prabhakar, VP - equity research at Anand Rathi.

If this acquisition falls through Eros will be a new entrant in the very challenging niche Bollywood entertainment channel segment. But it is not going to be an easy ride for Eros as it has tough competition in this space.