Independent seeking to up stake by 1-3%: Jagran Prakashan

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RK Agarwal of Jagran Prakashan says that the Independent News and Media group of UK, which has a stake in the company is ready to take a stake in their radio channel.

 

He adds that Independent will file for a Sebi nod to up its stake via the open market today. He further states that Independent is seeking to up its stake by 1-3%.

 

Excerpts from CNBC-TV18's exclusive interview with R K Agarwal:

Q: What exactly is Independent trying to do and would that require an open offer or are you working in such a way that the open offer would not be required?

A: They have been discussing right after the IPO, various possibilities to  increase their stake back to 26%, which they held during the pre-IPO time. Ultimately they were advised by their lawyers, perhaps if they want to make an acquisition of further stake, then they will have to make an open offer that is provided under Regulation 10,11,12 of Sebi.

Alternatively, they were advised they could approach Sebi for exemption from these regulations. Accordingly, they have given an application a few days back to be filed with Sebi and today maybe we will be filing it in the course of the day.

Q: They want to buy 3% more, which would take their stake to about 24%?

A: They have given a range that is between 1-3%. I will explain to you how did they come to this figure; typically the foreign holding in Jagran Prakashan has remained around 23%-25%. So this is how they have given the range of 1-3% and if Sebi grants 3%, they will be most willing to pick-up additional 3%.

Q: What is the nature of this agreement now? Will they just continue to hold above that 23% stake or are they looking to pump-in money into the operations of the Jagran Prakashan?

A: There is no agreement as such nor will money come back. Infact, if Sebi grants them exemption then they will acquire it from the open market.

Q: Have they expressed the desire to increase their stake then, above 24% maybe in the next few months?

A: It depends on Sebi's approval; how do they now deal with this application. Incase Sebi grants this exemption then as I said, they would be most willing to acquire 3% additional. So they reach a level of nearly 24%.

Q: There was some news item that suggested that Independent might be willing to pick-up stake in some of your other subsidiaries or businesses, in that radio was mentioned?

A: That is right, we have already filed an application with Ministry of Information & Broadcasting, and they are willing to take a stake of 20%, which is maximum, permissible for radio channels.

Q: What valuation have you determined for that?

A: I cannot disclose those details.

Q: At this point, Independent indeed is the largest stakeholder in Jagran Prakashan?

A: Yes, they are the largest single shareholders in Jagran Prakashan.