Private equity giant KKR has set up a media investment firm, Emerald Media, and plans to use it to seek assets in the Philippines, Thailand and Vietnam, among other destinations, most notably India.
The PE firm said yesterday that KKR Asian Fund II had committed $300 million to Emerald Media, a platform that can incubate assets, control or take minority stakes in firms.
“We have a base in place to build off,” said Rajesh Kamat, Singapore-based managing director at Emerald Media, citing investments in India and Indonesia that KKR already holds through its CA Media platform. “The way we see it, the market opportunity is clearly equally split between India and the rest of Asia.”
Emerald, which also plans to expand into North Asia, will acquire stakes in media, entertainment, and digital media businesses, investing $15 million to $75 million per transaction.
Kamat told AsianInvestor that Emerald also saw opportunities for consolidation in traditional media – print and broadcasting – partly due to valuations there being more attractive than for digital media.
Emerald gives joint managing directors – Kamat and Paul Aiello – more firepower to invest in Asian media and entertainment companies than they had at CA Media, which they continue to run.
“The Asian media industry is experiencing rapid and transformational changes driven by digitisation and growing internet and mobile penetration” said Aiello. India alone is expected to add 150 million digital households over the next few years.
CA Media has committed around $100 million to four India-based companies plus one in Indonesia since it was set up as The Chernin Group’s (TCG) Asian investment arm in 2010. The new deal sees KKR take a minority stake in CA Media. In turn, TCG becomes a minority co-investor in Emerald.
CA Media was tasked to focus on China, India and Indonesia deals when it was set up, but it has not yet invested in Chinese media or entertainment companies, instead focusing mostly on India deals.
However, KKR has undertaken a raft of China e-commerce deals this year via its 2010 vintage $1 billion China Growth Fund. In October, KKR, e-commerce giant Alibaba and insurance group Ping An invested $300 million in 58.com subsidiary 58 Home. In addition, KKR bought a $70 million stake in online education firm Tarena International in June and invested $170 million in online used car site Uxin in March (alongside search engine provider Baidu and US asset manager Coatue).