New Delhi, Sept. 18: The Financial Times of London will buy into Business Standard, marking the first investment by a foreign newspaper in an Indian daily.
Business Standard Limited today announced that the Financial Times will take a 13.85 per cent equity stake in the company for Rs 14.1 crore. This puts the worth of the total Business Standard equity at about Rs 102 crore.
In a press release, Business Standard said an agreement has been reached “in principle”. Details were being worked out before Business Standard applies to the government for clearance under the rules for foreign direct investment in print news.
The Centre last June overturned a nearly 50-year-old cabinet resolution that had debarred foreign investment in the sector.
The new rules cap foreign direct investment in news and current affairs for the print media at 26 per cent.
Last month, Henderson Global Holdings, a UK affiliate of an Australian financial services company, picked up a 20 per cent stake in a subsidiary company of Hindustan Times, ostensibly to promote a Bombay edition of the newspaper.
The Business Standard-Financial Times deal was always in the works. Business Standard had actively campaigned in favour of allowing foreign investment. The only element of surprise is the agreement has taken so long to be formally announced.
The Financial Times will join the Kotak Mahindra group and Great Eastern Shipping as the leading investors in Business Standard, the release said. The company will continue to operate as an independent entity, with its management reporting to the board, on which the Financial Times will have appropriate representation.
The release quoted Financial Times chairman David Bell as having said: “We are delighted to invest in Business Standard. It is an influential and highly credible publication which is respected inside and outside India. We’ve been working closely with Business Standard for years and are very pleased to be establishing a more formal relationship with them. This is an important strategic step for the FT as we expand our presence in the important Asian marketplace and extend the FT’s reach into a broader international business community.”
Business Standard’s editor and publisher T.. Ninan said: “We had worked actively to persuade the government to allow FDI in the print media. This investment in Business Standard, by a global newspaper with impeccable credentials and the best editorial and publishing practices, is vindication of the government’s new policy.”
Business Standard is published from seven centres in India and claims to be the country’s second largest financial newspaper.