Merger of UTV Software India with UMP PLC (UK) & UTV Motion Pictures (Mauritius) Ltd detailed analysis

2.  Company Overview
 Objective and Purpose of the scheme
 Group Structure (Pre & Post Merger)
 Merger Impact on Financials (Accounting & Tax Impact)
 Cash Flow Analysis
 Takeaways

3. • UTV Software Communication (incorporated in 1990) , a holding
company, makes and distributes movies, broadcasts a clutch of movie and
entertainment channels, produces content for television and other digital
media, and also has a presence in gaming. It operates through a number of
subsidiaries, including:
▫ UMP PLC (UK) – Holding Co of UTV Mauritius
▫ UTV Motion Pictures Mauritius – Movie Distribution Business
• Walt Disney is a multinational mass media corporation headquartered in
California. It is the largest media conglomerate in terms of revenue having a
huge presence across all media including Radio, Television, animation and
Print.
.
Company overview

4. Objective and Purpose
Walt Disney – Strategic Investor in UTV
Has a large presence across globally it has a limited presence in South
East Asia, especially India which is one of the fastest growing consumer
markets.
Strategic Acquisition
In September 2006, Walt Disney First time acquired 14% stake in UTV
Software solution Ltd.
In May 2008, Walt Disney raised stake from 14% to 32% at Rs. 861/- per
share & to match Disney’s fresh investment the Promoter Group have
committed to invest Rs. 4 billion into the Company.
In December 2008; there was decline in BSE & stock of UTV decreased to
around Rs. 250/- per share and Walt Disney increased the stake from 32%
to 61%.

5. Market Indexes and UTV Software Communication Ltd-Prices.
Non promoters Holdings Sep-08 Dec-08
Mutual Funds 24,81,986.00 10,96,296.00
Financial institution bank 1,71,675.00 72,827.00
Foreign institutional bank 50,79,310.00 17,94,176.00
Non institutional
Body corporate 24,91,446.00 9,80,431.00
individual 23,23,110.00 13,22,896.00
others directors 2,01,300.00 2,00,668.00
non resident indians 3,24,405.00 1,48,339.00
trust 64,250.00 62,290.00
others 3,34,986.00 49,051.00
•Prices fall to 225
• Strategic investment
opportunity cited by
The Walt Disney.
•Increased majority
stake 37.3% to 59.9%

6. Merger of UTV Software
India with UMP PLC
(UK) & UTV Motion
Pictures (Mauritius) Ltd.
In March 2010

7. UTV Communication
USA llc
India games
Limited
UTV Global
Broadcasting
Limited
IG Interactive
Entertainment
Ltd, UK
UTV Software
India
UTV GAMES LTD
TRUE GAMES
INTERACTIVE INC
FIRST FUTURE AGRI
& DEVELOPERS LTD
UTV NEW MEDIA
LTD.
UTV TV CONTENT LTD
GEN EX
ENTERTAIME
NT LTD
IGNITION
ENTERTAINMENT
LTD USA
IGNITION
LONDON LTD
IGNITION
ENTERTAINMENT
LTD UK
UTV
ENTERTAINMENT
TELEVISION LTD
SMRITI IRANI
TELEVISION LTD
RB
ENTERTAINMENT
LTD
99.75%
Pre Merger
Subsidiary Structure
UMP PLC (UK) UMP Mauritius

8. 0.25%
76.82%
99.75%

9. UTV Software Communication Ltd UMP Plc. (UK)
23.18 % share holder of UPM
Plc. To get UTV Software
Communication Ltd
The ratios was based on value
of Rs.341.45 per share
Every share holder of UPM
Plc got 1 share against 3.75
share
The value of deal was US $
194.74 m
Swap
Swap
SCHEME

10. UTV Communication
USA llc
India games
Limited
UTV Global
Broadcasting
Limited
IG Interactive
Entertainment
Ltd, UK
UTV Software
India
UTV GAMES LTD
TRUE GAMES
INTERACTIVE INC
FIRST FUTURE AGRI
& DEVELOPERS LTD
UTV NEW MEDIA
LTD.
UTV TV CONTENT LTD
GEN EX
ENTERTAIME
NT LTD
IGNITION
ENTERTAINMENT
LTD USA
IGNITION
LONDON LTD
IGNITION
ENTERTAINMENT
LTD UK
UTV
ENTERTAINMENT
TELEVISION LTD
SMRITI IRANI
TELEVISION LTD
RB
ENTERTAINMENT
LTD
UTV Tele
talkies ltd
100%
Post Merger Subsidiary
Structure

12. Accounting Treatment as per Scheme:
 Assets and liabilities at the book values
 Investments value adjusted in against the
Business restructuring Reserve (BRR)
 Accounting policies of UTV India to be applied
to assets and liabilities
 The Company Entitled to draw an amount from
securities premium account/other reserves to
BRR
 BRR to be utilized to write off assets etc.

13. Movement In Reserves
(Rs. In Millions)
2009-10 2008-09
Security & Share Premium A/c
As per Last balance Sheet 8,805.63 1,008.64
Add:Premium on Share issued on Preferential basis 7,957.01
8,805.63 8,965.65
Less: Trf to BRR (7,500.00)
Less: Utilised for W/off at indiagame Ltd. (30.77)
Less: Share / Debentures Issue (31.60) (160.02)
1,243.26 8,805.63 2009-10 2008-09
Capital Reserve Business Restructuring Reserves
As per Last balance Sheet - - As per Last balance Sheet - -
Reserve arising out of change in shareholding
pattern of Susideries
2,451.47 2,451.47 Trf from Security Premium A/c 7,500.00 -
Less: Reduction due to Merger of UTV Motion
Pictures (Mauritius )Ltd. & UMP Plc
(2,429.23) Trf to W/Off as per Schme -trf to P&L A/c (6,077.21) -
Add: Arised on account of Share issued by UMP Plc
2,602.97 Scheme Exps (320.26) -
Less: Trf to General Reserve (As per Scheme) (2,602.97) - Trf to Gen Res. (1,102.53) -
Add: Arised on account of Forfeiture of Share
warrants money received
390.11 - -
412.35 2,451.47
General Reserve
As per Last balance Sheet 47.50 47.50
Add : Trf from Capital reserve as per Scheme ) 2,602.97
Add: Trf form BRR -as per scheme 1,102.53
3,753.00 47.50

14. Particulars 2012-13 (standalone) 2011-12 2010-11 2009-10 2008-09
Total Revenue 6,756.58 4,698.27 5,777.10 6,844.80 6,919.28
Direct Cost (ref Note 1) 5,959.79 7,308.08 3,689.28 4,473.03 5,218.99
Depr, Amortisation,’ Impairment Exps. 27.95 47.95 19.24 61.66 69.53
Financial Cost (Income) 1,284.71 888.38 255.33 384.46 (76.61)
Other Exps 788.06 1,056.62 474.24 1,694.17 1,675.60
Profit Before Tax & Exceptional
Items (1,303.93) (4,602.76) 1,339.01 231.48 31.77
Exceptional Items (Note 2) 3,323.88 4,630.54 - 6,077.21 -
Trf from BRR 6,077.21
PBT (4,627.81) (9,233.30) 1,339.01 231.48 31.77
Tax Liability 751.43 - 0.13 (270.25) (433.40)
PAT (5,379.24) (9,233.30) 1,338.88 501.73 465.17
Profit & Loss Extract of UTV Group
Rs. In Mn

15.  Co. has amortised out approx .Rs. 4900
Million towards Movie cost in year 2011-12
 Exceptional items :Post merger company
w/off following amount.
Particulars 2012-13 2011-12 2010-11 2009-10
Fixed Assets - 7.30
Inventory - 4,199.78
Sundry Debtors - 84.97
Adv to Supplier - 134.70
Diminution-Investment
in Subsidiery Co 3,231.33 4,174.06 - -
Others 92.55 456.48 - 150.46
Inventory W/Off -in
Transferee Co - 1,500.00
3,323.88 4,630.54 - 6,077.21

16. 0.00%
10.00%
20.00%
30.00%
40.00%
50.00%
60.00%
70.00%
80.00%
90.00%
100.00%
Mar 08 Jun 08 Dec 08 Mar 10 Mar 11 Jun 11 Sep 11 Dec-11 Mar 12
Rohinton Screwvala
Unilazer Exports & Management Consultants Ltd
United Teleshopping & Marketing Company Ltd
Zarina Mehta
Unilazer Hongkong Ltd
Non Promoters
Walt Disney Company (South East Asia) Pte Ltd**
Linear (Rohinton Screwvala)
Change in shareholding pattern

17. SHAREHOLDERS
SHAREHOLDERS Mar 08 Jun 08 Dec 08 Mar 10 Mar 11 Jun 11 Sep 11 Dec-11 Mar 12
Rohinton Screwvala 9.20% 6.35% 6.35% 5.35% 4.25% 4.25% 4.24% 4.24%
Unilazer Exports & Management Consultants Ltd 13.01% 9.45% 9.45% 7.95% 9.25% 9.25% 9.22% 9.22%
United Teleshopping & Marketing Company Ltd 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00%
Zarina Mehta 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00%
Unilazer Hongkong Ltd 10.33% 7.50% 7.50% 6.31% 6.31% 6.31% 6.29% 6.29%
Non Promoters 67.46% 39.40% 16.75% 29.94% 29.74% 29.74% 29.96% 29.96%
Walt Disney Company (South East Asia) Pte
Ltd** 0.00% 37.29% 59.94% 50.45% 50.44% 50.44% 50.28% 50.28% 98.91%
TOTAL 100.00% 100.00% 100.00% 100.00%100.00% 100.00% 100.00% 100.00%
Share Price at Q end 765 761 255 463 576 826 948 979
Shareholding Pattern in tabular form

18. Particulars 2006-07 2007-08 2008-09 2009-10 2010-11 2011-12 2012-13 Total
Operating activites (566) 972 (5,287) (1,603) 1,693 (4,119) (3,328) (12,238)
Investment activities (493) (2,022) (3,184) (2,435) 660 (752) (4,509) (12,734)
Financing activites 1,128 983 9,085 3,726 (2,203) 4,853 8,014 25,586
Net increase/
(Decrease) in Cash &
Cash Equi
69 (67) 614 (311) 150 (18) 178 615
Year end Market
price/share - Rs.
296 775 203 462 585 1084
Rs. In Mn
Year wise Cash flows
from FY 2006-07 to FY 2012-13 (contd.)

19. Particulars 2006-07 2007-08 2008-09 2009-10 2010-11 2011-12 2012-13 Total
Operating activities
PBT 197 79 371 388 1,339 (9,233) (4,627) (11,487)
Depreciation 31 34 29 19 19 48 28 207
Amortisation of Movie copy rights 7 20 7 6 1,903 4,901 3,361 10,205
Net interest expneses / (income) 16 116 (283) 165 (46) 509 1,049 1,525
Profit on sale of fixed assets/
investments
(265) (8) (64)
(27)
(1) 7 22 (336)
Provision for diminution in the
value of investments
4,174 3,231 7,405
Provision for doubtfull loans &
advances
785 262 1,047
(Increase)/ Decrease in Receivables 6 (723) (3,712) 453 (557) (300) (422) (5,255)
(Increase)/decrease in Inventories (481) 560 (1,229) (1,891) (2,796) (3,366) (4,286) (13,488)
(Increase)/decrease in loans &
Advances
(642) 685 (1,983) (1,941)
(Decrease)/ Increase in trade
payables
(85) 916 (147) (357) 2,645 (2,221) 190 943
Taxes & Others 8 (21) (260) (359) (172) (107) (153) (1,063)
Total (566) 972 (5,287) (1,603) 1,693 (4,119) (3,328) (12,238)
Rs. In Mn
Year wise Cash flows
from FY 2006-07 to FY 2012-13 (contd.)

20. Year wise Cash flows
from FY 2006-07 to FY 2012-13 (contd.)
Investment activities 2006-07 2007-08 2008-09 2009-10 2010-11 2011-12 2012-13 Total
(Purchase)/ Sale of fixed assets
(235) 89 (26)
(6)
119
(3)
(22)
(84)
(Purchase) / Sale of investments (315) 3 (3,954) (837) 201 - - (4,901)
Share application money to
subsidiaries
- (642) (739) (1,629) 325 (792) (7,275) (10,751)
Advance to related companies - (1,550) 1,520 30 - - 2,270 2,270
Others (interest, dividend received) 57 77 14 7 15 43 518 732
Total (493) (2,022) (3,184) (2,435) 660 (752) (4,509) (12,734)
Financing activities
Share proceeds
655 338 8,051 - 1 327 8,841 18,211
Share warrants
38 - 390 - - - - 428
LT borrowings - Net
65 865 (880) 854 1,859 (1,222) 7,866 9,407
ST borrowings - Net 529 (10) 1,899 3,573 (3,440) 6,633 (7,511) 1,673
Interest capitalized (15) (17) (37) (317) (347) - - (733)
Interest paid (77) (193) (137) (352) (276) (885) - (1,918)
Dividend paid (incl DDT)
(65) (0) (40)
(0)
- - - (105)
Others (2)
- (160)
(32)
- - (1,182) (1,376)
Total 1,128 983 9,085 3,726 (2,203) 4,853 8,014 25,586
Rs. In Mn

21.  Rohinton Screwvala converted warrants into shares in
March 2008 @ 850 /- per share, which were originally
issued in Sep 06 @ Rs. 192 per warrant
 There was sudden fall in share prices of UTV Software
Communication Ltd in September 2008 from Rs. 800/-
(approx) to rate of Rs. 180/- (approx.) and that was the
time when Walt Disney increased its stake from 32% to
60% in the company.
 At the time of final delisting of UTV Software, Non
promoter holding included about 21 shareholders of UMP
Plc (who were issued shares during UMP Plc merger with
the company)
 There was sudden increase in Share Prices of the company
from down of Rs. 180/- per share and in other 2-3 years
promoters exited the company @ Rs. 1100/- per share.

22. FY 2008-09 & 2009-10
◦ May 2008 proposed to invest Rs. 3,901 Mn
(4,532,000 *860.79), but 10% - Rs. 390.1 mn is
invested.
◦ During the year Rs.8,051 Mn is invested by Walt
Disney
◦ based on increase in the Equity/ net worth,
increased borrowings Rs. 1,019 Mn during FY
2008-09 and Rs. 4,427 mn during FY2009-10

23. ◦ During 2009-10 – acquired the equity capital in India Games
Limited by its WOS IG interactive limited for a consideration of Rs.
259.19 Mn – Company holds 60.40% equity capital
◦ During 2009-10 – UTV games limited - has subscribed 4 mn
equity shares USD 1 each and also 3.65 mn preference shares USD
1 each
◦ During the 2008-09, Rs. 329.70 mn is taken back as advance and
acquired 10% stake in UTV Global Broad casting limited; by this
85% stake is created in his favour (page 91 of AR 2009-10)
◦ Share warrant conversion period – 18 months. During Nov 2009
it’s got lapsed and share warrants amount Rs. 390.01 Mn is
forfeited and transferred this amount to the capital reserve. (page
91 of AR 2009-10)
◦ Company delisted with effect from 2nd February 2012

24.  Ronnie Screwala (Original promoter of the UTV India)
resigned from the Company, appointed as Managing Director
of the company and finally he is making way for Mr.
Siddharath Roy Kapur, who is appoint as MD of Walt Disney
India Pte Ltd. (New Name of the delisted company) With
effect from 1st January 2014.