Case Study on M&A

Acquisition of Network18 by RIL

SUBMITTED TO: Prof. Meena Sharma SUBMITTED BY: Gopesh Virmani
MBA -IB
Acquisition of Network18 by RIL Is a Leading Media company in India with largest
bouquet of channels (55 domestic channels and 16
international beams), and a substantial digital presence

Founded: In1996 by Raghav Bahl

Company Profile Industry: Mass Media

Subsidiaries: TV18
Viacom18

Digital properties: MoneyControl,

BookMyShow
OTT video (VOOT)
How it Started?

Source: Business Today

Acquisition of Network18 by RIL

 Money invested by RIL in Network18 in 2012 was in

form of Optionally convertible debentures which can
be converted to shares within 10 year period.
How it  Thus on 29th May 2014 RIL announced the takeover.
Happened?  Through this deal IMT owned about 78% of stake in
NW18
Acquisition of Network18 by RIL RIL got access to all the digital properties of Network18 group
including :
 Homeshop18
 IBNLive.com
Benefits to RIL  MoneyControl.com
 BookMyShow.com
 Cricketnext.in
Acquisition of Network18 by RIL RIL got access to the broadcast channels of Network18 group
including :
 Colors
 CNN-IBN
Benefits to RIL  CNBC
 IBN7
 CNBC Awaaz
Acquisition of Network18 by RIL

Current Ratio  CURRENT RATIO = CURRENT ASSETS / LIABILITIES

 Current Ratio Year
Current Ratio
2.5
2011 2.131763666
2.1318

2 2012 0.141718621

2013 1.438842111

1.5 1.4388
2014 0.251514372

2015 0.059611756
1
2016 0.056544606

0.5 2017 0.045205763

0.2515
0.1417 2018 0.064135842
0.0596 0.0565 0.0452 0.0641 0.0317
0
2019 0.031689119
2011 2012 2013 2014 2015 2016 2017 2018 2019
Acquisition of Network18 by RIL

Quick Ratio
 Quick Ratio Year
Quick Ratio
2.5
2011 2.131763666
2.1318

2 2012 0.140179716

2013 1.438842111

1.5 1.4388
2014 0.251219619

2015 0.058831437
1
2016 0.055767335

0.5 2017 0.044802188

0.2512
0.1402 2018 0.063739354
0.0588 0.0558 0.0448 0.0637 0.0312
0
2019 0.03120829
2011 2012 2013 2014 2015 2016 2017 2018 2019
Acquisition of Network18 by RIL

Average Age
of Inventory
 Average Age of inventory
Year Average Age of
250 inventory

215.26
2012 60.3
200

2014 19.1

150 146.74
137.56
2015 138
122.07
115.81

100 2016 122

60.28 2017 116

50

19.08 2018 147

0 2019 215
2012 2014 2015 2016 2017 2018 2019
Acquisition of Network18 by RIL

Total Asset
Turnover Ratio
 Total Asset Turnover Ratio Year Total Asset Turnover
Ratio
0.08

0.0710 2011 0.025464086

0.07
2012 0.070979646
0.06
2013 0.046108225
0.05 0.0461
2014 0.024067618
0.04
2015 0.021048623
0.03
0.0255 0.0241 2016 0.019044075
0.0231
0.0210
0.02 0.0190
0.0169 0.0166
2017 0.016879132

0.01
2018 0.016583545

0
2019 0.02311266
2011 2012 2013 2014 2015 2016 2017 2018 2019
Acquisition of Network18 by RIL

Fixed Asset
Turnover Ratio
 Fixed Asset Turnover Ratio Year Fixed Asset Turnover
Ratio
0.08 0.0761
2011 0.038767754
0.07
2012 0.076051394
0.06
2013 0.050773773
0.0508
0.05
2014 0.025259129
0.04 0.0388
2015 0.021341318
0.03
0.0253
0.0235 2016 0.019324451
0.0213
0.0193
0.02 0.0172 0.0171
2017 0.01715694

0.01
2018 0.017071703

0
2019 0.023549663
2011 2012 2013 2014 2015 2016 2017 2018 2019
Acquisition of Network18 by RIL

Net Profit
Ratio
 Year
Net Profit Ratio Net Profit Ratio
0
2011 2012 2013 2014 2015 2016 2017 2018 2019 2011 -176.3558064
-15.35
-100 -73.46
-104.37 -91.26 -104.22
2012 -104.3674717
-135.16
-200 -176.36 -177.45 2013 -15.34650187

2014 -73.46090038
-300

2015 -91.25950105
-400
2016 -135.1589095

-500
2017 -177.4531858

-600 2018 -104.2211484

-666.22 2019 -666.2150809

-700
Acquisition of Network18 by RIL

Return on
Total Assets
 Return on Total Assets Year
Return on Total Assets
0
2011 2012 2013 2014 2015 2016 2017 2018 2019 2011 -0.044109779
-0.0071 -0.0177 -0.0162
-0.0257 -0.0300
2012 -0.074357685
-0.05 -0.0441

2013 -0.007076
-0.0744
-0.1 2014 -0.017680289

2015 -0.194723897

-0.15
2016 -0.025739765
-0.1566

2017 -0.029963413
-0.2 -0.1947
2018 -0.016211146

2019 -0.156586938
-0.25
Acquisition of Network18 by RIL

Debt - Equity
Ratio
 Debt to Equity Ratio Year
Debt to Equity Ratio
1.4

2011 1.15995119
1.2 1.1600

2012 0.371002016
1

0.8 2013 0.113668016

0.6 2014 0.065394716

0.4 0.3710 2015 0.000913599

0.2 2016 0.000257319

0.1137
0.0654
0.0009 0.0003 0.0001
0 2017 0.000137734
2011 2012 2013 2014 2015 2016 2017
Acquisition of Network18 by RIL

Revenue from
Operations
 Revenue from operations(in lakhs) Year Revenue from
25,000.00 operations

2011 39,90,66,070

20,000.00 19,489.14
18,321.12 2012 1,83,21,12,150

2013 1,94,89,13,547
15,000.00

2014 1,02,01,91,355
10,201.91
10,000.00
2015 74,32,07,000
7,432.07 7,036.00
6,729.93
6,686.00 2016 67,29,93,000
5,000.00 3,990.66
2017 66,86,00,000

0.00
2018 70,36,00,000
2011 2012 2013 2014 2015 2016 2017 2,018
Acquisition of Network18 by RIL

Revenue
Generated
 Total revenue(in lakhs) Year
Total revenue
30000
27,890.59
26,464.65 2011 67,21,85,348
25000
2012 2,64,64,65,220

20000
2013 2,78,90,58,893
16,280.00
15,435.32
15000 2014 1,54,35,31,742

2015 86,70,62,000
10000 8,670.62
7,630.92 8,205.00
6,721.85 2016 76,30,92,000
5000
2017 82,05,00,000

0
2018 1,62,80,00,000
2011 2012 2013 2014 2015 2016 2017 2,018
Acquisition of Network18 by RIL

Loss over the

Years
 Loss for the year (in Lakhs) Year
Loss for the year
0
2011 2012 2013 2014 2015 2016 2017 2,018
-2,991 2011 -6,913
-10,000 -6,913 -7,494 -6,321
-9,096
-11,855
2012 -19,193
-20,000
-19,193
2013 -2,991
-30,000

2014 -7,494
-40,000

2015 -68,755
-50,000

2016 -9,096
-60,000

2017 -11,855
-70,000 -68,755

2018 -6,321
-80,000
Acquisition of Network18 by RIL

Share Prices
of Network18
 10
20
30
40
50
80

60
70

0
2-May-14
5-May-14
6-May-14
7-May-14
8-May-14
9-May-14
12-May-14
13-May-14
14-May-14
15-May-14
16-May-14
19-May-14
20-May-14
21-May-14
22-May-14
23-May-14
26-May-14
27-May-14
28-May-14
29-May-14
30-May-14

High
2-Jun-14
3-Jun-14
4-Jun-14
5-Jun-14
6-Jun-14
Volume

9-Jun-14
Share Prices Vs Volume

10-Jun-14
11-Jun-14
12-Jun-14
13-Jun-14
16-Jun-14
17-Jun-14
18-Jun-14
19-Jun-14
20-Jun-14
23-Jun-14
24-Jun-14
25-Jun-14
26-Jun-14
27-Jun-14
30-Jun-14
0
5000000
10000000
20000000
25000000

15000000
Acquisition of Network18 by RIL

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