The Hyderabad-based Deccan Chronicle Holdings, publisher and owner of Deccan Chronicle, is set to acquire a majority stake in Asian Age Holdings, publisher of The Asian Age.
Sources close to the development said Deccan Chronicle, which held a 20 per cent stake in The Asian Age, would increase its stake beyond 50 per cent. An announcement to this effect is expected this week.
When contacted, M J Akbar, editor of The Asian Age and one of the promoters of Asian Age Holdings, told Business Standard that both the companies were working on "something good".
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While refusing to comment on the exact details, Akbar said, "Obviously, it is good news. I have been wanting this to happen for the last 20 years." The Asian Age is published simultaneously from New Delhi, Mumbai, Kolkata, Bangalore and Ahmedabad.
P K Iyer, executive director, Deccan Chronicle Holdings, declined to comment on the acquisition. "Any important announcement will first be made available to the stock exchanges," Iyer said.
The Reddy family, promoter of Deccan Chronicle, and Akbar enjoy a long relationship. Deccan Chronicle chairman T Venkattram Reddy is on the board of The Asian Age. Akbar is the chief editor of Deccan Chronicle and had served nearly a year as a director of the company.
The Reddy family recently diluted nearly 22 per cent stake in Deccan Chronicle through an initial public offer.
Deccan Chronicle, which also prints International Herald Tribune in India, has recently launched a Chennai edition. Print media sources said the Chennai edition was fast catching up with the leader in the Southern market, The Hindu.
The Deccan Chronicle stock has been moving up for the past few trading sessions. It reached its 52-week high of Rs 205 on Friday. However, it closed at Rs 199.90, 1.76 per cent higher than the previous close on the Bombay Stock Exchange.
Although the exact shareholding of Asian Age Holdings is not known, sources close to the development said in addition to Deccan Chronicle's 20 per cent stake, Akbar has a 26 per cent stake in the company. The remaining is widely held.
Asian Age's sales in the year ended March 31, 2004 was Rs 16 crore (Rs 160 million). Profit after tax stood at Rs 75.25 lakh (Rs 7.5 million) and the equity capital was to the tune of Rs 771,000.
Paper deal