MUMBAI: Subash Chandra-led Zee Group is believed to have put in a bid for acquiring the German broadcaster EM Sport Media AG’s entertainment division, which is on auction currently. The deal size is estimated to be around $100 million (about Rs 400 crore), including the debt of the target company.

Sources said Zee is likely to pay around $60-70 million for the entertainment division of EM Sport Media, which comprises EM Entertainment and Junior TV. If successful, the deal would help Mr Chandra storm into continental Europe’s youth entertainment markets.

The acquisition will include EM Entertainment’s Australian production studio Flying Bark Prods, which is expected to hit the market with animation content like ‘Zigby’, ‘Master Raindrop’ and ‘Zeke’s Pad’ shortly.

Post-acquisition, Zee will also have to absorb the target business’s liabilities of around $30-40 million.

Sources said the sale decision is a part of the German major’s plan to emerge as a pureplay sports media player. European media reports indicate that EM had put the entertainment unit on the block almost a year ago.

A company source said discussions were going on with EM. “We have not yet received the board approval of Zee Entertainment, the group’s entertainment outfit, for the acquisition in question,” he added. However, a Zee spokesperson denied the development, when contacted. Zee Entertainment, with current Mcap of $2.3 billion, boasts of the highest international subscription revenue among the Indian broadcasters. On Wednesday, Zee Entertainment stock closed almost flat at Rs 213.90 on BSE.

The entertainment division of EM Sport produces programmes for the child and youth markets, global trading of television rights and markets home entertainment contents. Junior TV airs pay-television channel, which it broadcasts in markets such as Germany, Austria and Switzerland.

The entertainment broadcasting business has strategic ties with SwiscomBroadcast and Cablecom in Switzerland and Premiere in Germany and Austria. The German media group said two months ago it was prolonging the process of offloading the entertainment unit. It also devalued the division from e90 million to e50 million to attract more offers.

The devaluation was attributed to the turbulence in the financial market and an anticipated demand softening for licence productions. Hence, the evaluation is expected to sweeten the re-financing options for the potential suitors.

With the entertainment unit focused on delivering across new digital platforms, it has also picked up stake in the US video-on-demand business Kabillion and has inked alliances with VOD providers such as Maxdome and Glowria.