India’s Homeshop18 has upper hand in merger

Two online entities in the Indian market have decided to merge their businesses – e-commerce venture Homeshop18 and home-shopping group Shop CJ Network.

Homeshop18 is a subsidiary of Network18 Media & Investments, with Saif Partners, GS Home Shopping South Korea and OCP as co-investors, while Shop CJ is an equal JV between Korea’s CJO Shopping and P5 Asia Holding Investments (Mauritius) from the Providence Equity Partners group.

Their merger aims to unite two of India’s home-shopping companies to create the largest home-shopping platform in the country, say the partners. The resultant benefits of scale are expected to help the venture better compete in the TV home-shopping landscape in the face of challenge from e-commerce players.

Under the deal, Shop CJ shareholders will be issued 25 per cent equity in HomeShop18, making Shop CJ a subsidiary of HomeShop18. After the transaction, HomeShop18 will no longer be a subsidiary of Network18 Media & Investments, which will continue to be the largest shareholder in the combined entity.

Homeshop18 raised an undisclosed sum in its last round of funding in July last year. In April 2013, the company raised US$30 million from hedge fund OCP Asia, with Network18 and OCP contributing $15 million each.

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