Geodesic Information Systems will acquire a 94 percent stake in magazine publisher Chandamama for Rs.10.2 crores reports Reuters. As per the report, the cash component of the deal is Rs.1.6 crores.
Geodesic is a listed entity, and as per their declaration to the BSE, the rest of the payment will be by means of a preferential share issue for Chandamama shareholders. Preferential shares worth Rs.265 per share (on face value Rs.2 each) will be issued for a share swap for acquisition. To ratify this board decision, Geodesic India will convene an Extraordinary General Meeting of its shareholders on March 31. Chandamama is a children’s magazine that sells over 200,000 copies in over 12 languages. Chandamama shareholders include former Morgan Stanley MD Vinod Sethi, the family of fimmaker B. Nagi Reddy, and corporates including the Tata and the Dabur group.
Geodesic intends to digitize Chandamama content for the Internet and Mobile. What makes this move interesting is that Geodesic has been more of an aggregator and enabler - with an Instant Messenger, Ad manangement system and an Internet Radio software - than a content creator. Earlier, it had been reported that Walt Disney was in talks to buy out Chandamama for Rs.20 cores, and this deal has gone through for around half that.
Update: The Economic Times adds that Geodesic is in talks with individual shareholders to acquire the remaining 6 percent.
Related:.
-- Back Issues Of Chandamama To Be Digitized
-- Walt Disney In Talks With Indian Household Name “Chandamama” For A Buyout