Changing hands?

Ranchi/Calcutta, Feb. 9: “Negotiations are in an advanced stage” is the only comment that stakeholders were willing to make on Friday.

But the buzz is that Jharkhand’s leading newspaper Prabhat Khabar is all set to change hands. Unconfirmed reports put the UP-based Jagran group and MP-based Dainik Bhaskar group, the latter also the publishers of the English daily DNA (Daily News & Analysis) in Mumbai, as front-runners to buy Neutral Publishing, the firm that publishes Prabhat Khabar and is about to launch two FM radio stations from Ranchi and Jamshedpur.

While Dainik Bhaskar does not have a presence in the East, Jagran already has editions in Patna, Ranchi, Jamshedpur and also Bhagalpur. It is not clear at this point whether the group, if it manages to buy Prabhat Khabar, will opt to retain both the brands and all the editions.

Usha Martin Industries Ltd (UMIL) bought Prabhat Khabar, which was launched in 1984, from Congress leader Gyan Ranjan in 1989 for Rs 2.5 crore.

Usha Martin, a company registered at Calcutta , last year appointed merchant bankers, Edelwiess Capital to do the valuation and find strategic investment partners. While UMIL initially planned to sell a part of the equity to raise funds to finance the radio stations, expansion of PK and re-launching its Patna edition, it was advised to sell out after merchant bankers received bids ranging from Rs 100 to 120 crore.

The industry grapevine held on Friday that Jagran had emerged as the most eligible suitor by topping the highest bid by over Rs 20 crore. A formal announcement is expected ‘in the near future’ , maintained these sources. But Sunil Gupta , one of the directors of Jagran, K.K. Goenka, the PK general manager and Harivansh, the newspaper’s chief editor, declined comment.

Several reports had earlier reported that since 1996 , Usha Martin had not invested anything for the newspaper. “ Harivansh, Goenka and R.K. Dutta were told to fend for themselves,” claimed an insider, “ and the understanding was that the newspaper could swim or sink on its own steam.”

Creation of Jharkhand gave the newspaper a fresh lease of life and it began to expand vigorously. It successfully warded off competition from both Hindustan and Jagran and overcame a crisis when as many as 33 trained journalists walked over to join Hindustan at more fancy salaries. Strong identification with the new state, vigorous marketing and readers’ meets, bold and brave exposes and content helped the newspaper overcome the odds.

Prabhat Khabar, which apparently sold just 600 copies daily in 1989, has at present seven editions, spread across three states. The Audit Bureau Of Circulation ( ABC) put its circulation at 2.28 lakh copies in its report for the period January to June, 2006. The Hindi Hindustan was a distant second at 1.69 lakh copies. Since then, according to some surveys, Hindustan has overtaken PK as the most circulated Hindi daily in the state.

The annual advertisement revenue of Prabhat Khabar is estimated to be in the region of Rs 35 crore , which prompted some bidders to question the abnormally high valuation of the company. But Advertisement growing in the East at a fast clip, at nearly 19 per cent a year compared to the national average of 15 per cent, Jharkhand has suddenly become attractive to the media. The Times of India too has been planning to extend its footprint to the state.