Indian newspaper publisher Jagran Prakashan Ltd. will merge with English-language publication Mid-Day Multimedia Ltd., the Hindustan Times reported yesterday.
The Mid-Day board yesterday agreed to the "cashless deal," in which each Mid-Day shareholder will receive two shares of Jagran for seven shares of Mid-Day, according to the Wall Street Journal. The share price of Mid-Day rose 18 percent on the news, while Jagran's share price went down by 3.2 percent, the Times noted.
The publisher's dip in share price was due to the equity dilution of 5 percent that the deal caused, the WSJ reported.
Jagran publishes India's most read newspaper, Hindi-language daily Dainik Jagran. The deal will give Jagran, which publishes mostly in northern India, a foothold in the Mumbai market, as well as add to ad revenue and earnings, according to the WSJ. For its part, Mid-Day will benefit from Jagran's resources and larger scale, according to Reuters India.
The merger comes as readership for Hindi dailies outpaces English-language readership.