Eros acquires a 51% stake in Ayngaran
12/07/2007
Thursday 12 July 2007: Eros International, the leading integrated media company in
the Indian entertainment sector, today announces its foray into Tamil films, the
second largest film segment in India after Hindi films, by forming a joint venture with
Ayngaran, who have a dominant market share in the Tamil content and distribution
industry.
Eros will have a 51% majority shareholding of Ayngaran International Limited, a
newly incorporated holding company that is acquiring the business, goodwill and
assets of the Ayngaran business, subscribed for a nominal sum.
The transaction will give Eros access to Ayngaran’s library of over 600 films, while
securing rights to approximately 25 new films already in development.
The deal, following Eros’s recent announcement of a 76 per cent rise in full-year
profits, forms part of a strategy to pursue partnerships and acquisitions in the
fragmented Indian film industry.
Kishore Lulla, Chairman & CEO, Eros International said: "We are really excited about
this deal. Ayngaran is the Eros of Tamil films. The business is in the same stage as
the Hindi film segment was 10 years ago, poised to expand rapidly.”
K KarunaMoorthy, Chairman of Ayngaran said: “Aligning with Eros will allow us to
accelerate our growth and become a global player in Tamil films by maintaining and
building on our competitive advantage.”
Eros will provide an initial funding to the new venture of US $33 million funded
through internal and external sources to take over and grow the existing business as
well as to produce, acquire and distribute forthcoming Tamil films based on agreed
forecasts and targets.
Eros and Ayngaran previously co-operated on the international distribution of the film
‘Sivaji-the Boss’ starring Tamil star Rajnikant, which was released on June 15 this
year. The film created history by grossing over US$ 25 million worldwide; the highest
ever for any Tamil film and featured in the UK charts in spite of showing across just
13 Cineworld screens.
Mr Lulla added: “As part of our consolidation strategy this will allow us to tap into new
market segments, audiences and revenues within our core business".
K KarunaMoorthy of Ayngaran said: “Eros is a very large and respected player within
the Indian entertainment sector. We believe that we will greatly benefit from Eros’s
experience in bringing scale to the distribution through their worldwide infrastructure
and marketing muscle.”
Out of the total 1,090 films produced in India in 2006, 223 films were Hindi language
feature films and 162 films were Tamil films. Internationally, Tamil films have a huge
market in UK, USA, Canada, France, Germany, Norway, Switzerland, Malaysia,
Singapore, Sri Lanka, South Africa, Australia and the United Arab Emirates.
About Eros International plc
Eros International plc is a well established global player in the fast-growing Indian
media and entertainment arena. Being vertically integrated means that Eros not only
produces and commissions films, like a studio, but it also distributes/exploits films
across formats globally via cinemas, home entertainment, television formats and new
media. Established in 1977, Eros International has three decades of market
leadership in creating a global platform for Indian cinema. The company operates in
over 50 countries with worldwide offices in India, UK, USA, Dubai, Australia, Fiji and
Isle of Man. It has built a successful business model around the release of 30-40 new
films every year and the exploitation of a film library containing more than 1,300 titles,
making it one of the largest content owners in the business. Global Distribution,
Motion Pictures, Music, Home Entertainment, e-Television, New Media and
Animation are the main Strategic Business Units of Eros. Eros enters its 30th year in
the business with the vision of consolidating the fragmented industry, the strategy of
operating a vertically integrated business model and the motto: ‘Powering Indian
Cinema’.
About Ayngaran
Ayngaran has been the pioneer in Tamil film distribution in theatrical and home video
formats in the international market. The history of the Ayngaran business dates back
to 1987 when it had the vision to acquire the international rights across formats of
many Tamil films that became blockbusters. The Ayngaran library has over 600 films
including “Kandukondein Kandukondein”, “Kannathil Muthamittal”, “Alaypauthey”,
“Kadhalukku Mariyadhai", “Mudalvan” and “Indian”. Ayngaran has very deep
relationships within the Tamil film fraternity and has over 75% market share
internationally in its space. Ayngaran operates on a model that exploits theatrical,
home video, television and new media window across markets.
For more information visit www.erosplc.com.
For enquiries please contact:
Brunswick - 020 7404 5959