Popular Noida based online marketplace and television based home shopping network, HomeShop18 has acquired 74% stake in Shop CJ Network in a deal worth $27.45 million. HomeShop18 is one of the many ventures of Network 18 Media and Investments. Private equity investor Providence Equity Partners and Korean firm CJ O Shopping have an equal joint share in Shop CJ Network.
Post this acquisition, it will permanently close its Mumbai Headquarters and transfer its operations to Delhi-NCR. A few months ago, it shut down its Tamil Home shopping center. Also, Providence Equity Partners will also try to sell its stake completely and look for an exit.
Shop CJ network, formerly known as Star CJ, was launched in 2009 as an equal joint venture between CJO shopping and Star India. However, in 2014, Star India sold its stake completely to Providence Equity Partners for $63 Mn.
Tjhe company’s television channel was launched in April 2008 and their online marketplace in Homeshop18.com in January 2011 by the Media group Network18. PE firm SAIF Partners has invested a hefty amount in the venture. Also, South Korea’s GS Home Shopping is their strategic investor.
Homeshop18’s majority of revenue is generated from its television shopping business. It also generates a considerable amount of revenue from the commission it receives from the sale of products by its vendors via its platforms. Reliance Industries Limited (RIL) of Mukesh Ambani acquired Network18 in the year 2014 and HomeShop18 is now owned by them. HomeShop18 filed a $75 million public issue in 2014. However, within just seven months of its filing on the NYSE, it got discarded.
In February 2017, Homeshop18 fired and lay off around 200 employees. It was done to lower the cost of operations. The company employs 600 employees and reduced their staff strength by around 40%.