Saturday, 8 May, 2010

Jagran group acquires Mid-Day's newspaper and web business

It was cooking for a while and it happened yesterday. Jagran Prakashan announced on 5 May 2010 that it will acquire all the print business of Mid-Day Multimedia. The deal is done without any cash outgo although the Jagran group is sitting on a pile of cash. Mid-Day shareholders will get two shares of Jagran for every seven shares of Mid-Day Multimedia. Four newspapers of the publication arm of the group — the wholly owned subsidiary Mid-Day Infomedia — will come to Jagran Prakashan: the afternoon English daily Mid-Day, Sunday Mid-Day, Gujarati Mid-Day and Inquilab which is an Urdu daily. The deal also includes the website The afternoon tabloid Mid-Day is published from Mumbai, Delhi, Pune and Bangalore the latter three being relatively new publications from a group that was during the freedom movement in 1938 with the Daily Inquilab. Inquilab published from Mumbai is currently the largest Urdu daily in the country. Sunday Mid-Day and Gujarati Mid-Day are also published from Mumbai only. MML would continue to own its seven radio stations around the country and its shares will continue to be listed on the Mumbai stock exchange.

The Hindi daily Dainik Jagran has the most readership of any newspaper in India with 54.2 million readers according to the IRS 2010 Q1 figures. Its 37 editions are printed from 30 locations across eleven states. The company also publishes i-Next a bilingual tabloid targeted at youth, a women’s monthly Sakhi, and an annual general knowledge digest Jagran Varshiki. The group also runs an outdoor signage business with an all-India footprint known as Jagran Engage.

In a filing to the Bombay Stock Exchange, Mahendra Gupta chairman and managing director of Jagran Prakashan said, “We will be able to not only improve the existing profits of MML’s print buisness, but also add value to the businesses of both the companies for the benefit of all the stakeholders.” Tarique Ansari the managing director of Mid-Day Multimedia will remain on the board of Mid-Day Infomedia although it is not clear whether he will also get a seat on the Jagran Prakashan board. In the stock exchange filing Ansari said, “the newspaper business will see some significant changes in the years to come. Scale and access to resources will critical factors in the success of any newspaper company. By aligning with Jagran we will be able to pool resources with the largest newspaper group in the country to grow profitably and deliver better value to shareholders."

Mid-Day was to some extent the David to Times of India’s Goliath in Mumbai in the days before HT Media and the DB-Zee TV partnership began publishing their English dailies there. Tarique Ansari was a bit ahead of his times in his ideas about multimedia penetration and the behaviour of his readers — or newsers as he called them. Jagran has used its FDI from the Independent News and Media group in a steady and organised way which is why even after the Independent’s considerable divestment in February 2010, it was able to attract a Rs. 225 crore investment from Blackstone in April 2010.

This is a great combination of two media groups that have come out of the freedom movement. Today they cannot merely fight for a political cause but have to contend in the marketplace as businesses and create new paradigms and tools. Together they present a range of geographies, languages, cultures and styles – the megalopolis with the heartland.

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