Independent News & Media has moved to increase its stake in Indian newspaper publisher Jagran Prakashan.
The Irish group, which already has a 20.8 per cent stake in Jagran - the publisher of India's most popular daily newspaper - confirmed yesterday it has applied to the Indian regulator for permission to increase its stake by between one and three percentage points without having to initiate a takeover approach for the Indian company.
As much as 59.2 per cent of Jagran is owned by the Gupta family and, under current Indian stock market legislation, any substantial increase in Independent News & Media's stakeholding would trigger an element of the takeover code requiring the two groups to make a joint offer for the company because the public shareholding in the group had fallen below 20 per cent.
A foreign firm can hold a maximum 26 per cent shareholding in the Indian group - the level held by Independent News & Media before its stake was diluted in the Indian group's flotation last February.
If permission is granted, the Irish group plans to acquire the stock from the open market. The shares were yesterday trading at around 307 rupees (€5.20).
Jagran Prakashan last month reported profit after tax of €4 million in the first quarter. Revenue increased 20 per cent, to €24 million.
Independent News & Media, which also has interests in Australia, New Zealand, Britain and South Africa, is seeking to increase its foothold in India yet further with a move into the radio market.
A spokesman last week confirmed the group was looking at opportunities in the radio sector in India but declined to comment on reports it was buying a 20 per cent stake in Jargan's own radio division, Shri Puran.
But Jagran Prakashan's chief financial officer RK Agarwal yesterday confirmed that this was Independent's intent.
At Independent News & Media's annual general meeting in June, chief executive Sir Anthony O'Reilly was upbeat about growth in the firm's Indian investment and also expressed an interest in further acquisitions in eastern Europe.
