The Times Group, one of India’s largest media conglomerates, and BBC Worldwide have formally signed an agreement to set up a joint venture to publish magazines in India.
It was only six months, when the media giants signed a memorandum of understanding to set up a joint venture, which shaped up on April 7, 2004. As per the formal agreement, the 50:50 joint venture will produce and market magazines from both the partners in India. It will also facilitate the exchange of content, titles and know-how for the Indian market.
BBC is among one of the major media companies to strike such a deal in India after rules regarding foreign ownership in media were relaxed.
The details of the joint venture will be clear only after the necessary statutory approvals are sought. The companies have yet to apply for the FIPB clearance and the application is likely to be filed next week. JM Morgan Stanley was the advisor to The Times Group, while Udwadia & Udeshi and Amarchand Mangaldas provided the legal support.
“This joint venture marks a new beginning for both the media houses. Together we will bring to our readers our collective skills and aim to successfully produce and market magazines that capture the pulse and mood of readers,” said Vineet Jain, Managing Director, Bennett, Coleman & Co Ltd (BCCL).
As per the new agreement, Jain will also be the first chairman of the new joint venture. “It will be a revolving chairmanship. The chairman of the joint venture will change every two years,” said Arun Arora, President, The Times Of India Group.
Dwelling on the formation of the partnership, Peter Phippen, Managing Director, BBC Magazines, BBC Worldwide, observed: “There will be significant growth in the Indian market over the next few years. BBC has a long established track record in India through BBC World Service and BBC World and, the combination of the greatly respected brands, Times Group and BBC is a very impressive and exciting prospect.”
As Phippen added, the magazine medium was the most powerful and a personal medium. A magazine takes into account people’s aspirations, concerns and needs and therefore, it was one of the most preferred and fastest advertising mediums.
The venture plans to take over the publishing of the 29 magazines currently offered by The Times Group. These include Femina, Filmfare, femina Allure, JLT (Just Like That), IAGT (It’s a Guy Thing), Kidzone, Strategic Marketing, Shipping Journal and many other B2B titles. BBC Magazines, on the other hand, has a portfolio of 50 niche publications such as Gardeners’ World, Good Homes, Good Food, Eve, History, to name a few and the top most among them are Radio Times, a television entertainment magazine, and Top Gear, a Motoring magazine.
“The JV should unlock and enhance the value of these magazine brands, created by BCCL,” said Probal Ghosal, Group CFO, BCCL. He added that the commitments and deliverables of both the parents were an integral part of the structure to ensure value maximisation for shareholders.
Despite a plethora of television channels, the print medium in India still commands 51 per cent of the national advertising expenditure. And, the magazine market is equally growing.
Talking about their group publications, namely Femina and Filmfare, Pradeep Guha, President, The Times Group, said: “As per the last released IRS data, Filmfare is the sixth highest read magazine with a readership of 25.42 lakh. It also tops in readership among all the English magazines. Femina, on the other hand, with 11 lakh readers is the eighth most widely read magazine and has the highest readership amongst all women’s magazines in English. While the advertising revenues of the magazines across India has grown by 69 per cent over the last five years, Femina has seen a growth of 75 per cent.”
With this joint venture, The Times Group is looking to redefine the magazine landscape in India. “There are three things that will drive the magazines’ growth: the country’s growing economy, changes in lifestyle coupled with higher disposable incomes and, the savings habit of individuals. And, all these three factors are interconnected with each other,” Arora said.
The editorial control will remain with the CEO, Magazines SBU, Devashish Sarkar and his team. However, the policy guidelines will be given by the Board, which will comprise of equal number of members from both the media organisations.
As for the two properties Femina Miss India Contest and the Filmfare Awards, as per the agreement, all the brands will come under the JV, while The Times Group will manage the Miss India Contest.