3i, Cisco, Oman Investment Fund invest $152 mn in Nimbus for 28% stake

Nimbus Communications, a media company with interests in general entertainment and sports, received private equity funding of $152 mn (Rs. 552 crores) for a 28.5% stake in the company. Private equity firm 3i, technology MNC Cisco and Oman Investment Fund (OIF) were the investors. Deutsche Bank and Americorp Ventures already hold stakes in Nimbus. The deal is being billed as the largest-ever private equity investments in the Indian media and entertainment sector. The advisors in this private equity transaction were Euromax Capital and Enam Consultants.

The private equity investment in Nimbus would be through compulsory convertible debentures with a likely conversion scheduled prior to the company’s listing. This would be the final round of private equity investment before the company gets listed, which could be done within three years. The shareholding of the promoters would come down to between 40% and 44%, currently standing at 54%.

Nimbus has earlier said that it is interested in expanding its sports facilities and also the technology platform for future launches. Film distribution is another growth area. The money will be utilized to expand the company’s international sports business and diversify into football and golf. A part of the funds will also be utilized to finance Indian language films, international film production and distribution, developing digital content for wireless and IPTV platforms and to expand the company’s broadcasting operations.

3i is one of the largest UK-based private equity funds, managing close to $10 bn globally. This is the second round of investment for 3i in Nimbus. In 2005, the fund had invested $45 mn for a 33% stake in the company. In the current tranche, it has put in $30 mn for 6.5%. Early this month, 3i invested $22 mn in Indian digital cinema chain UFO Moviez (See Related Post). OIF, promoted by Sultan of Oman, has invested $75 mn for an 18% stake while Cisco got 4% for $20 mn. Cisco’s investment is based on its strengths in IP television, a platform that Nimbus plans to foray into, while OIF will help Nimbus boost its presence in the Middle East. Nimbus’ current revenues stand at $310 mn, up from $70 mn when 3i first picked a stake in it. Over the last five years, the company has received close to $200 mn (Rs. 900 crores) in foreign investments.

Read the articles in The Economic Times – 1 2.

3i invests $22 mn in digital theatre chain UFO Moviez

Private equity firm 3i has invested $22 mn in UFO Moviez, a digital cinema chain. It has an option of investing another $3 mn later.

UFO Moviez plans to utilize the money to part finance its expansion plans. It intends to invest in hardware to expand its presence in India and overseas in markets like the Middle East, South-East Asia and Africa by January ’07. UFO plans to scale up its Indian operations from 600 to 2000 screens and plans to reach 3000 digital cinema houses worldwide by 2008.

This is the second investment by 3i in the media space, the earlier being in Nimbus Communications, which holds the BCCI global media rights till 2010. Apollo group’s Onkar Singh Kanwar owns 60% in UFO, while about 15% is held by the Singapore-based DG2L Technologies. The remaining stake is held by its CEO Sanjay Gaikwad.

Read the article in The Economic Times.