Tata Sky is planning to list its shares early in 2022. The Tata Group company will be filing its draft red herring prospectus (DHRP) with the Securities Exchange Board of India (SEBI) soon for a proposed IPO by the end of March 2022, a media report said.
“Work on the draft IPO prospectus is in advanced stages and could be filed with Sebi by next month; so, the deal could possibly be launched before the end of this fiscal,” people with the knowledge of the matter told Hindustan Times.
The size of the proposed IPO may be around Rs 2,000-3,000 crore and a mix of primary capital raising for use in the business and secondary share sales by existing investors, the report said.
Tata Sky had started its services in 2004 as 80:20 joint venture. The company was a venture between Tata Sons (owning 70 percent of the stake) and Rupert Murdoch’s 21st Century Fox (owning 30 percent). Singapore-based Temasek Holdings purchased 10 percent stake in the company in 2008 from Tata Sons, and The Walt Disney Company purchased 21st Century Fox’s stake in the company in March 2019.
Kotak Mahindra Capital is the primary investment bank in charge of the process while other foreign banks are also part of it. The IPO is expected to offer fresh offers-for-sale from Disney, which is looking at selling its stake.
“Disney does not have investments in any other distribution platform apart from Tata Sky. This is non-core for them, and they want to focus on their main consumer-focused business of Disney+, given the fierce competition in the OTT market. Other options were explored in the past to either bring in a strategic investor or Tatas buying Disney’s stake; but right now, it looks like the IPO is the way forward for the company,” the report quoted an official aware of the development
According to the report, there are other investors, too, such as Temasek and Tata Capital, who have been investing in the company for a long time. They are also looking at diluting some of their stakes. Disney will also sell a part of its stake in the IPO, the report added.
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