The fragmented media industry is heading for several mid-sized deals in coming quarters as cash-rich regional players try to expand and larger but loss-making operators look to consolidate around core segments.

The $12 billion media and entertainment industry, which has seen a handful of recent mergers, is poised for a wave of small to mid-sized deals across radio, television, newspapers and cable distributors, bankers and analysts said.

"There is some appetite now for mergers and acquisitions," said Jehil Thakkar, media analyst at KPMG Advisory, who expects deals worth a total $100-$150 million in the sector.

"Industry is still recovering, not recovered. So people who need to cashout will see it as an opportunity to do so in the next few months," he said.

India has about 500 TV channels, 100 multi-system operators, thousands of cable operators and seven DTH operators, India's market regulator said. The total number of registered newspapers was 69,323, as of March 31, 2008, according to the Registrar of Newspapers for India.

Cash-rich Sun TV is eyeing buys in the broadcast space, sources directly involved said, while Viacoml8, a joint venture between Viacom and Networkl8, has said it is planning expansion in the entertainment space.

Newspaper publishers Jagran Prakashan and a unit of HT Media Hindustan Media Ventures have said they are looking at acquisitions to boost their presence across India.

However, loss-making TV networks will primarily look at simplifying their shareholding pattern and strengthening balance sheets as they are in need of capital after facing a lean 2009, a banker at a foreign investment banking firm said.

"We have seen some fund-raising and more is in the offing. These funds will be used to capitalise their balance sheet and acquire assets," he said, adding the acquisitions could be worth about $50-$200 million.

Loss-making Television Eighteen has said it will consider selling stake in some non-core operations and its board will meet on Wednesday to consider a restructuring proposal with two other entities.

Last year, NDTV sold its general entertainment channel to a unit of Time Warner Inc and has said it is now looking for a buyer for its lifestyle unit after talks with Scripps Networks fell through in May.

"NDTV and TV18 are selling out a lot of stuff," said Anand Shah, analyst with Angel Broking. "They want to focus more on their core business and divest all their loss-making businesses and clean their balance sheet."

REGIONAL GOES NATIONAL

While TV networks are selling off units, newspapers are looking at acquisitions to fuel growth.

"Regional players are starting to get fairly aggressive in building a larger footprint. Because they took less of a hit in the downturn," KPMG's Thakkar said. Most print publications in India are regional.

Recently, U.S. private-equity firm Blackstone Group said it will invest about $50 million in the Jagran group, which later acquired Mid-Day Multimedia's newspaper business.

Jagran is looking for more strategic partnerships where it can acquire stakes, R.K. Agarwal, chief financial officer of Jagran told Reuters last week.

"Media is a very buoyant industry. As competition gets tougher, there will be people who will get weaker. We will wait for the right time to pick up such players," said Anup Sharma, chief financial officer of HMVL, which is looking to raise 2.7 billion rupees in an initial public offering.

Others expect the industry to remain fragmented despite the consolidation.

"It's not going to be stagnant consolidation. While you might see some channels absorbed, you might see the launch of four or five new ones. There will be M&A but it will continue to remain fragmented,” said KPMG'sThakkar.