The Disney-Reliance India Media Merger Has Been Approved
After intense scrutiny that seemed to put the deal in jeopardy, India’s Competition Commission has approved the merger between Reliance Industries Limited and The Walt Disney Company’s India business, subject to “voluntary modifications.”
Initially announced in February, the deal will see Reliance’s Viacom18 combine with Disney-owned Star India. Once the agreement is completed, Star India will become a joint venture owned by Reliance, Viacom18, and Disney.
FILE PHOTO: Mukesh Ambani, chairman of Reliance Industries Limited, poses for photographers before addressing the annual shareholders meeting in Mumbai, India, June 12, 2015. REUTERS/Shailesh Andrade
Unless the terms have changed since the initial deal, Reliance will own between 51 and 53% of the business, while Disney will hold 40%. Bodhi Tree will own the remainder of the company.
Cricket Was the Sticking Point
The merged entity will own India’s two biggest streaming services and 120 television channels. It will also become the dominant force in cricket broadcasting, something that gave regulators pause.
Between them, Disney and Reliance owned the television and streaming rights to the Indian Premier League and the men’s and women’s global events conducted by the International Cricket Council. As India’s most popular sport, cricket will be the backbone of the new merged entity.
Photo: BBC
“India is the world’s most populous market, and we are excited for the opportunities that this joint venture will provide to create long-term value for the company,” Disney CEO Bob Iger said.
It is unclear what voluntary changes Disney and Reliance agreed to to get their merger approved. Last week, however, the Competition Commission publicly expressed concerns about the new conglomerate. Now, the body says a more detailed approval report will come shortly.
A New Chapter For Disney
Today’s approval will mark a new chapter for Disney in India.
Photo: Indian Express
In recent years, Disney has seen the valuation of its India business plummet. When the company acquired Star as part of its purchase of 21st Century Fox, its India business was valued at roughly $16 billion.
By the time the company began exploring a merger with Reliance, Disney’s India business was worth $3.5 billion. Now, Disney will get a fresh start in India.
Photo: Disney
