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Nimbus to launch three sports channels; raises fresh capital

16-May-2006
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Nimbus to launch three sports channels; raises fresh capital

Nimbus Communications Limited will launch three India-facing 24-hour sports pay TV channels between October 2006 and September 2007. The first channel will be cricket-centric, showcasing all of Indian home cricket, both international and domestic. This will commence broadcasting from October 2006.

The second channel will focus on sports entertainment, not restricting itself to merely sports events but also broadcasting sports-themed entertainment programmes. This is expected to commence broadcasting from April 2007.

The third channel, a sports news service focused on news, scores, data/statistics and features, will launch September 2007.

Digvijay Singh, CEO, Nimbus Sport, said, “Cricket is the world’s greatest advertising vehicle with 120 natural breaks per day and 96 per cent commercial break viewership against an average of 40 per cent for movies and soaps.”

Nimbus expects that with TV advertising growing at 19-21 per cent per annum, cricket advertising would outpace that like it has over the past five years to achieve growth rates of 25-27 per cent annually.

The cricket-centric channel will have a footprint extending to select Asian countries besides India, including Malaysia, Hong Kong, Singapore, Indonesia, Sri Lanka and Bangladesh, and possibly the Middle East. It will not operate in Pakistan. Nimbus has licensed GEO TV in Pakistan for rights to its BCCI events.

As reported, Nimbus raised Rs 135 crore (US$ 30 million) of fresh capital last week, and has the option of seeking another Rs 135 crore (US$ 30 million). SAE Euromax Capital Ltd., the London-based boutique investment bank, acted as the transaction advisor to Nimbus.

In 2005, 3i, a leading global private equity firm, invested US$ 45.5 million (approx Rs 200 crore) in Nimbus, and this capital has given Nimbus the impetus to scale up is sports and filmed entertainment businesses rapidly.

The newly raised capital is being invested by Nimbus largely in its sports broadcasting business. Said Harish Thawani, Chairman, Nimbus, “Our vision and business model has been to be the world’s first and cricket’s largest on-ground to on-air solutions, vertically integrated sports company. This vision will be fulfilled with the launch of our sports channels.”

The introduction of three new DTH platforms in India in 2006, besides the existing one (not counting Doordarshan’s free service), is expected to provide a major thrust to cricket channels. In addition to revenues from cable, multiple DTH platforms would drive subscription revenues. Nimbus will be providing separate feeds to DTH (HDTV, interactive, multiple languages), cable (SDTV customised, English/Hindi) and DD (basic feed) to give consumers a choice and advertisers several targeted communities.

Nimbus has been involved in the two largest cricket commercial rights deals in the history of the sport -- the 2001-2007 ICC rights (as GCC’s mandated agency) and the BCCI’s worldwide media rights for 2006-2010. Nimbus’ collective transaction experience in cricket rights exceeds US$ 1.5 billion, making it the world’s largest cricket rights management agency ever.

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