Televisionpoint.com Correspondent | Mumbai
The Walt Disney Company and founders of UTV Software Communications have jointly acquired an additional 22.65 per cent in the Indian company through an open offer, which began on October 8 and closed on October 27.

The shareholding of the two parties in UTV Software rose to 83.25 per cent. Earlier, Disney and UTV founders had made a joint open offer to acquire a further 20 percent stake in UTV Software Communications.

In February, Disney had reached a deal to more-than-double its stake in UTV Software, as part of the U.S. entertainment firm's move to expand globally.

At Rs 233, the stock trades at nine times its estimated 2008-09 earnings. Good viewership ratings for UTV's content in TV production and airtime sales suggest bright prospects for the company. Gaming, where the bulk of activity happens in the December quarter, is another high potential business.

The stock has fallen over 70 per cent in the past one year, dogged mainly by concerns about losses in its broadcasting business and the heavy investments that UTV has committed across its verticals. The stock's status as a mid-cap stock in the media pack, also took its toll.

Both UTV and Disney have invested about Rs 360 crore in the broadcasting space and another Rs 100 crore will be invested over the next 18 months. This vertical has five channels in operation and is generating losses and is expected to continue to do so over the next year or so.

UTV's youth channel Bindaas and movie channels such as Bindaas Movies and World Movies and business channel UTVi may see substantial investment. Four of their five channels are pay channels, while the business news channel UTVi is free to air.

The synergy with the Walt Disney group across verticals, especially in broadcasting, tie-up with ABC News for its business channel UTVi and in areas of gaming, movie syndication and television content augur well for the company.