Press
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