TV18 Broadcast and e-Eighteen.com Ltd will be merged with Network18, the companies said through separate exchange filings. Following this, shares of both companies plunged in trade on Thursday.
While Network18 shares fell 8% to Rs 90.90, those of TV18 Broadcast plummeted 8.5% to Rs 51.50.
In trade on Wednesday, shares of TV18 surged nearly 8% to settle at Rs 56.20, and those of Network18 climbed 8.4% up to Rs 98.45.
Both stocks have risen for the last six consecutive sessions, with TV18 gaining as much as 35% in this period and Network18 adding about 21%.
Intraday, TV18 Broadcast shares had hit an 18-month high, and Network18 Media a 19-month high.
This suggests that a section of market insiders were probably aware of the development and took advantage of the same. On Wednesday, Network18 Group announced the merger of TV18 Broadcast and e.Eighteen.com, which owns and operates Moneycontrol website and application, with
Network18 Media & Investments through a share swap deal.
Under the proposed merger scheme, shareholders of TV18 Broadcast will get 100 shares of Network18 Media for every 172 shares held in the former.
Shareholders of E18 will receive 19 shares of Network18 Media for every 1 share held in the former.
The merged entity will comprise the television portfolio of TV18 comprising 20 news channels in 16 languages and CNBCTV18.com, digital assets of Network18 comprising News18.com platform across 13 languages and Firstpost, as well as Moneycontrol website and application.
Viacom18 with its portfolio of JioCinema and 40 TV channels will be a direct subsidiary of Network18. Network18 will continue to hold its investment in BookMyShow.
An integrated entity for news gathering and dissemination as a result of the merger is
expected to drive cost and content synergies, the group said.
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