The board of directors of home shopping platform HomeShop18 have approved the acquisition of Shop CJ in a share-swap deal, a move that will "create the largest home-shopping platform in the country," HomeShop18 said in a statement. "The two companies will enter into a definitive agreement," it added, and the combined entity will provide better growth prospects, “allowing it to improve its standing in the TV home-shopping landscape and compete better with the challenge from e-commerce players,” the statement said.
"We believe multiple synergies with respect to sourcing, marketing and delivery can be exploited through a combination with Shop CJ, which shall further accelerate this process," HomeShop18 said.HomeShop18 was India's first comprehensive digital commerce player, selling a wide range of products to customers nationally through TV, internet and mobile.
For the acquisition deal, the shareholders of Shop CJ will be issued 25 percent equity in HomeShop18. After the completion of the acquisition, HomeShop18 will no longer be a subsidiary of Network18 Media & Investments Ltd. However, Network18 will continue to be the largest shareholder in the combined entity. HomeShop18 counts SAIF Partners, GS Home Shopping South Korea and OCP as its investors. ShopCJ, previously known as Star CJ, is a 50:50 joint venture between South Korean home shopping major, CJO Shopping and P5 Asia Holding Investments (Mauritius) Limited belonging to the Providence Equity Partnersgroup.(Disclaimer: HomeShop18 is a part of Network 18, publisher of Forbes India)