London — Wananchi Group, the owner of East African pay TV operator Zuku TV plans to launch a fresh funding round for US$50 million (€38 million) to US$100 million before the end of the year, according to CEO Richard Bell.
Bell provided insights on the move: the extra funds will be used to be present in 15 markets and to boost its content and service features. Sylvain Béletre, Senior Research Analyst at Balancing Act talked to managing director of Wananchi Programming, Hannelie Bekker to understand the investment's impact on Zuku TV's content.
Richard Bell said that since Wananchi Group was founded in 2008 it has already raised just over US$300 millions from investors including Liberty Global and Altice Group, and that the new funds will allow it to further grow its TV operations.
In 2011 Wananchi raised US$57.5 million in growth capital from investors including Liberty Global, Oppenheimer Funds, Canada-based emerging markets fund manager Sarona Asset Management, and African private equity firm East Africa Capital Partners.
"We're looking to grow the footprint of the business, both for the satellite TV and the cable business and so whilst the existing business plans are fully funded, we would anticipate raising additional rounds of finance in the future to fund expansion into the new markets," said Bell.
He said that on the cable side Wananchi expected to "launch in contiguous markets from our base in East Africa" and to also rollout its satellite service in more markets. "We will launch a round for an addition US$50 to US$100 million between now and the end of the year," he said.
Though Bell wouldn't comment on the precise markets Wananchi was eyeing next, the firm already has cable operations in Kenya, Uganda and Tanzania.
On the satellite pay TV side, Bell said the firm was actively distributing its service in six countries in East Africa but "will expand to 12 to 15 during the course of next year."
In line with this, Wananchi last month completed the migration of its Zuku TV satellite service from SES's NSS-12 satellite to SES-5 - a move that Bell said gives it more capacity as well as wider reach, with the new satellite having a footprint over "the whole of Sub-Saharan Africa."
"With regards to the migration from NSS-12 to SES-5, "the additional bandwidth has allowed us to greatly expand the DTH offering . It enabled us to provide HD channels to satellite customers (Zuku Movies Max HD and Zuku Sports HD), and also to add a range of new channels.
These include TLC, Discovery Science, Zee Khana Khazana (Indian cooking channel), Short International (short film), UTV (Bollywood), Setanta Action, etc. We also continue to add free to air channels from around the region" Hannelie Bekker confirmed to Balancing Act.
Bell also said that the firm expects to grow its channel line-up from the nine linear channels it owns and operates today to "12 to 15 over the next two years." Its current channels include Zuku Sports, Zuku Movies Max and Zuku Swahili Movies.
"With regards to Zuku channels, Zuku has been active in securing local sports rights over the recent months. ZUBL (Zuku Unuversity Basketball League) saw the company invest in Kenya's longrunning university league offering capacity building, training, sponsorship and a consistent television presence in the form of weekly magazine show, Baqe.
The company also recently announced that they have secure a 5-year agreement with KRU (Kenya Rugby Union) for all games played under the auspices of the KRU" added Hannelie Bekker.
As Kenya moves from analogue to digital broadcast from December 2013, all Zuku customers can expect great quality signal available to them anywhere and everywhere in Kenya, because the Zuku decoder is compliant to the digital migration requirements set out by CCK. With over 70 channels, Zuku TV has a wide range of programs that will keep the whole family adequately entertained.
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Source: Hannelie Bekker from Wananchi Group and Digitaltveurope 15 Aug 2013