Reliance To Pump In Rs 11,500 Cr for JV’s Growth Strategy
Chennai, NFAPost: In a major consolidation in the Indian media landscape, Ambani-promoted Reliance and Disney on Wednesday announced a strategic joint venture to bring together under an umbrella the most compelling and engaging entertainment brands in the country.
As part of the deal, Reliance Industries Ltd (RIL), Viacom 18 Media Pvt Ltd and The Walt Disney Company has announced the signing of binding definitive agreements to form a joint venture that will combine the businesses of Viacom18 and Star India.
As part of the transaction, the media undertaking of Viacom18 will be merged into Star India Pvt Ltd (SIPL) through a court approved scheme of arrangement. In addition, RIL has agreed to invest at closing a sum of Rs 11,500 crore into the JV for its growth strategy.
The transaction values the JV at Rs 70,352 crore on a post-money basis, excluding synergies. Post completion of the above steps, the JV will be controlled by RIL and owned 16.34% by RIL, 46.82% by Viacom18 and 36.84% by Disney. Disney may also contribute certain additional media assets to the JV, subject to regulatory and third-party approvals. Nita M. Ambani will be the chairperson of the JV, with Uday Shankar as vice chairperson providing strategic guidance to the JV.
The JV will be one of the leading TV and digital streaming platforms for entertainment and sports content in India, bringing together iconic media assets across entertainment (Colors, StarPlus, StarGOLD) and sports (Star Sports and Sports18) including access to highly anticipated events across television and digital platforms through JioCinema and Hotstar.
The JV will have over 750 million viewers across India and will also cater to the Indian diaspora across the world. The JV will seek to lead the digital transformation of the media and entertainment industry in India and offer consumers high-quality and comprehensive content offerings anytime and anywhere.
The combination of the media expertise, cutting-edge technology and diverse content libraries of Viacom18 and Star India will allow the JV to offer more appealing domestic and global entertainment content and sports livestreaming services, while delivering an innovative and convenient digital entertainment experience at affordable prices.
With the addition of Disney’s acclaimed films and shows to Viacom18’s renowned productions and sports offerings, the JV will offer a compelling, accessible and novel digital-focused entertainment experience to people in India and the Indian diaspora globally.
The JV will also be granted exclusive rights to distribute Disney films and productions in India, with a license to more than 30,000 Disney content assets, providing a full suite of entertainment options for the Indian consumer.
Speaking about the JV, Reliance Industries Chairman and Managing Director Mukesh D Ambani said this is a landmark agreement that heralds a new era in the Indian entertainment industry.
“We have always respected Disney as the best media group globally and are very excited at forming this strategic joint venture that will help us pool our extensive resources, creative prowess, and market insights to deliver unparalleled content at affordable prices to audiences across the nation. We welcome Disney as a key partner of Reliance group,” said Reliance Industries Chairman and Managing Director Mukesh D Ambani.
Walt Disney Company CEO Bob Iger said India is the world’s most populous market, and the company is are excited for the opportunities that this joint venture will provide to create long-term value for the company.
“Reliance has a deep understanding of the Indian market and consumer, and together we will create one of the country’s leading media companies, allowing us to better serve consumers with a broad portfolio of digital services and entertainment and sports content,” said Walt Disney Company CEO Bob Iger.
Bodhi Tree Systems Cofounder Uday Shankar said the company is privileged to be enhancing relationship with Reliance to now also include Disney, a global leader in media & entertainment.
“All of us are committed to delivering exceptional value to our audiences, advertisers, and partners,” said Bodhi Tree Systems Cofounder Uday Shankar.
The transaction is subject to regulatory, shareholder and other customary approvals and is expected to be completed in the last quarter of calendar year 2024 or first quarter of calendar year 2025.
