msm india ott joint venture investment overview september 4, 2013

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MSM IndiaOTT Joint Venture Investment OverviewSeptember 4, 2013

#1Executive SummaryMSM has an opportunity to invest in a new joint venture company (JVCo) being formed with Network18 Media & Investments Limited (Network18) to own and operate in.com, an over the top online video (OTT) platform One-stop entertainment portal that includes movies, TV series, original series and user generated videosAvailable on all digital platforms both within India and to Indian expats globallyBalanced revenue model with SVOD, TVOD and advertisingNetwork 18 is an Indian media and entertainment company with operations in TV, internet, film, e-commerce, magazines and mobile content including:Several news channels including CNBC-TV18, CNBC Awaaz, CNN-IBNA joint venture with Viacom which owns several entertainment channels including Colors, MTV, SONIC, Comedy Central, VH1, Nick, Nick Jr. and Nick TeenA joint venture with A+E Networks which owns HistoryTV18MSM proposes to acquire a non-controlling 26% equity stake in JVCo with a capital commitment of $10.1M based on the Proposed Business Plan Capital commitment will be partially offset with license fees MSM will receive for its contributed contentUnder the Proposed Business Plan, the key financial metrics to JVCo and to MSM are as follows:

#Summary of Proposed Deal Structure and Material TermsMSM proposes to acquire a non-controlling 26% equity stake in JVCo with a capital commitment of $10.1M based on the Proposed Business Plan Deal assumes Network18 will own the remaining 74% of JVCo however A+E Television Networks could make a 15% - 20% investment in JVCo and reduce Network18s stakeNetwork18 has an option to sell an additional 15% stake in JVCo to another potential partner with MSMs express written consentJVCo has a proposed Initial Term of 5 yearsJVCo shareholders may sell their stakes in JVCo after the Initial Term subject to a right of first refusal by the remaining shareholdersJVCo will have a Board of 7 directors with 2 directors selected by MSMJVCo will acquire the domain name in.com from Network18 for a value of $5.5MNetwork 18JVCo 26%76%MSM#3Proposed JVCo Business Plan

#4Financial Impact to MSMMSM Perspective EBIT Impact During Proposed Business Plan PeriodMSM Perspective - Cash Flow Impact During Proposed Business Plan PeriodCumulative Cash Flow Breakeven Expected by FY17To determine the impact to MSMs investment earnings, license fees for content contributed by MSM was included

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