15Nov2009
· Investment of $18.5 mn (~Rs 85 cr assuming $1=Rs 46) comes from Korea based GS Home Shopping (GSHS) to acquire 15% equity stake in HomeShop18 valuing Homeshop18 at around Rs 571 cr. GSHS has entered in a strategic agreement with the HomeShop18’s parent firm Network18 to lend its expertise in the areas of Sourcing, Merchandising, Broadcasting and Logistics to scale the HomeShop18 business in India. This will be facilitated by way of seconding key employees to HomeShop18 as well as training HomeShop18 employees in Korea. HomeShop18 also plans to leverage on GSHS' good relationships with suppliers in China and in other parts of the world.
· Network18 Holdings (a wholly-owned subsidiary of Network18) would infuse the remaining $5 mn (Rs 23 cr) to hold on to controlling stake of 51% stake in the Company.
· After the deal, Network18 holds roughly 51% stake in HomeShop18, 15% will be with GSHS, and about 27% with SAIF Partners.
· HomeShop18 was created in Apr 2007 with SAIF (Softbank Asia Infrastructure Fund) Partners as an anchor investor, which is a pioneer PE investor in Home Shopping in India and China.
· Currently, HomeShop18 is hitting a run rate of just about Rs 25 cr a month on gross sales and is doing about 2 lakh orders in a month. It reaches out to 1.5 mn consumers across 2700 cities in India and is the largest e-commerce player in India as well.
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