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B4U plans Rs 1 billion fund for film financing

Prachi Verma

The B4U group is talking to financial institutions like IDBI to put together a fund with a corpus of around Rs 1 billion to facilitate funding of films in an organised manner.

The B4U group is also expected to hold a 50 per cent stake in the entity, which will manage this film fund and is likely to see the light of day by the end of this year.

"We may raise the corpus of Rs 1 billion through a combination of debt and equity and ideally B4U will like to hold at least 50 per cent stake in the legal entity controlling the film fund," Ravi Gupta, CEO of B4U Multimedia International said on Monday on the sidelines of an Indo-French seminar on new technologies in the broadcast industry organised by Agency for International Promotion of French Technology and Trade and the Economic, Trade and Finance Commission of the French Embassy in partnership with BECIL, IBF and BESI.

"The motive behind the film fund will be to search for fresh talent in the film industry which gets lost for want of funds and also corporatise the whole funding structure," he said.

Though the fund will initially target only Bollywood, Gupta said the involvement of NRI promoters of B4U (minus Bharat Shah being questioned for alleged links with the underworld) will also allay some misgivings of FIs in funding non-tangible assets like films where the level of uncertainties are high.

For this financial year- the group - operating two channels B4U Digital entertainment and B4U Music, has identified three main areas for investments -Bollywood content development, content for the broadband service providers and for the direct-to-home (DTH) television platform operators.

B4U is also looking at investing between Rs 1 and 2 billion in all the above mentioned areas and is planning to raise these funds via internal accruals and private placements.

Currently, the company is in talks with two foreign broadband service providers for the foreign markets.

"We have not yet identified any Indian broadband player but have an option to tie-up with foreign broadband service providers who either have presence in India or have Indian broadband service providers as partners," Gupta said.

According to Gupta they are looking at forming a broadband company in association with Eros International, a company of Kishore Lulla, who is also a promoter of B4U Multimedia.

The company, which has a presence in the US, Middle East, Canada and now in Europe and Africa will soon start its services in South Asian countries in a big way, Gupta said.

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