In January 2012, Reliance Industries Limited (RIL), India’s second-largest publicly listed company, had announced it would invest a substantial sum in Network18. At the time, they looked like saviours: over two days, Network18 stock jumped 27 percent. The movement indicated a kind of euphoria, given that Network18’s share price had, at the time, fallen almost 95 percent from its 2007 highs. It had incurred over Rs 800 crore in accumulated losses in 2011–2012—while the company said its losses were Rs 191 crore ($30.45 million), had it not used a convenient accounting standard, its losses would have been Rs 835 crore ($133.12 million). But Reliance’s investment was also disconcerting. A company with strong links to government and extraordinary interests in petrochemicals, refining, and telecommunications, had helped ease mounting debt at an influential news organisation that owned two business channels, a business website, and published the business magazine Forbes India. “I don’t think the group saw how it was going to be perceived,” a senior editor at Firstpost told me this October. Thanks to Reliance’s investment, a rapidly expanding group deeply in debt and prone to frequent cost-cutting measures now had the one thing that had been in perennially short supply: security. For some employees down the chain, the investment seemed like a boon. “We felt a little good about a reliable company buying a stake,” a reporter who was later laid off told me. “We thought it would become more stable.” When I met Tushar Pania, a spokesperson for Reliance, at the company’s office in south Mumbai this September, he claimed that they had very little role in the retrenchments. “It’s not our intent to run the business,” he said. “We don’t know the media business. If we wanted to run Network18, we would have run it.” Reliance Industries has acquired Network 18 and its affiliates. In our December 2013 issue, Rahul Bhatia reported on how Reliance gained a foothold in Raghav Bahls media company.
Posted on: Thu, 29 May 2014 13:44:00 +0000
Trending Topics
Recently Viewed Topics
© 2015