Sahara Media & Entertainment is renegotiating the valuation for its acquisition of a 20-30 per cent stake in Adlab’s wholly owned subsidiary Entertainment One.
A fresh valuation is needed as the proposed deal will exclude mega movie project ’The Rising,’ which is part-funded by Entertainment One. Sahara had disassociated itself from the project after noted actress Aishwarya Rai was dropped. Ms Rai is council director in the Sahara Group.
Adlabs chairman and managing director Manmohan Shetty said, “there will be a revised valuation of Entertainment One. As the deal will exclude The Rising, the valuation will come down.”
Mr Shetty added, “we do not want to dilute more stake. The fund infusion from Sahara, thus, will be lower than earlier proposed and we are negotiating on that.”
Sahara’s plan to acquire stake in Entertainment One is seen as a move to broadbase and strengthen the company’s activities in film production. Sahara had, in November, proposed to acquire a 20-30 per cent stake in Entertainment One, Mr Shetty said.
The valuation of Entertainment One had included The Rising. This was before the controversy took place over the movie which is being produced by Mr Bobby Bedi.
Entertainment One is investing 25 per cent of the project cost for the movie.
When contacted, Sahara Media & Entertainment chief executive officer Sushanto Roy said, “We are still working on it.” He refused to give further details.
Entertainment One has appointed an agency while Sahara has its legal advisors working on the deal.
“We will be meeting after the first week of January to start the talks again. We hope to complete the deal in a month’s time,” Mr Shetty said.
Entertainment One has produced movies like GangaaJal and plans to be involved in 4-5 movies a year. The company is also funding Govind Nihalani’s Dev. Entertainment One has a cap of Rs 18 crore for investments in film projects at any given point of time.