All About Newspapers

AMALGAMATION
Jagran to take over newspaper
business of Mid-Day Multimedia

agran Prakashan Limited (JPL) - a leading media house of India publishing Dainik Jagran, India’s largest read daily with a total readership of 54.2 million readers (IRS 2010 Q1) - is all set to acquire print business of Mid-Day Multimedia Limited, comprising Mid-Day (published from Mumbai, Pune, Bangalore and Delhi), Sunday Mid-Day, Gujrati Mid-Day and the Inquilab -the largest read Urdu newspaper in the country and all publications related internet properties.

The board of directors of JPL in its meeting held recently has approved the scheme of arrangement under sections 391 to 394 of the Companies Act, 1956, which would result in demerger of print business from Mid-Day Multimedia Limited (MML) and transferring it to JPL with effect from April 01, 2010. However, the scheme of arrangement is subject to necessary approvals and consents.

The newspaper publishing business of the Mid-Day group was launched during the freedom movement by Abdul Hamid Ansari with the Inquilab in 1938. With the launch of Sportsweek in 1968 and Mid-Day in 1979, the group strengthened its position as a significant player in the Mumbai newspaper industry. Subsequent launches of Sunday Mid-Day, Gujrati Mid-Day and three new editions of Mid-Day in Pune, Bangalore and Delhi have poised the group to make significant inroads as a national publisher. Recently, MML has transferred its publishing business to its wholly owned subsidiary company Mid-Day Infomedia Ltd (MIL). During the year 2009-10, MIL has recorded sales and operating revenue of nearly Rs 95 crore with operating margins exceeding twenty percent.

The Mid-Day group also has radio stations in seven key cities of India, through its subsidiary Radio Mid-Day Ltd. The radio business of MML will continue to stay with the present shareholders of Mid-Day Multimedia Limited. The valuation of the two businesses has been done by Ernst and Young Private Limited and swap ratio as per their report dated May 05, 2010 works out to be 07 : 02 (i.e. for each 07 fully paid up equity shares of Rs 10 each of MML, its shareholders will be entitled to two fully paid up equity share of Rs 02 each of JPL).

The flagship newspaper of Jagran Prakashan Limited, Dainik Jagran, established in 1942 as the brainchild of the Indian Freedom fighter late Puran Chandra Gupta, is now published in 37 editions across 11 states from 30 different facilities. JPL launched i-next, the first ever bilingual newspaper in the country in December 2006 and now published from four states with twelve editions. The company also has an English infotainment paper City Plus published with 24 editions. Besides, they publish monthly magazines Sakhi targeted at women and Josh focusing on career oriented youth. The group also publishes Jagran Varshiki, an annual general knowledge digest and various national and state statistical compilations.

Mahendra Mohan Gupta

“Mid-Day and Inquilab both are strong brands enjoying unique market position, which will be further strengthened. The proposed merger offers us numerous opportunities to increase our market share in our existing markets and to enter into the new markets. Mid-Day, being a compact newspaper, complements with our compact brands namely i-next and City Plus, which is also circulated in Mumbai. Gujrati MiD-DAY and Inquilab, being Indian language newspapers, fit well in our inorganic growth strategy and will enable us to add to our offerings to our customers. I am confident that with the present professional and experienced management team supported by Tarique Ansari, who is going to continue as director on the Board of MIL, we will be able to not only improve the existing profits of MML’s print business but also add value to the businesses of both the companies for the benefit of all the stakeholders,” said Mahendra Mohan Gupta, chairman and managing director, JPL, commenting upon the transaction.