 "Disney, Reliance")
Reliance and Viacom18 will be holding 63.16 per cent stake in the combined entity, which will have two streaming services. Walt Disney will hold the remaining 36.84 per cent stake. Photo: Reuters
Reliance Industries’ entertainment arm Viacom18 and Walt Disney Co’s Indian media assets on Wednesday received competition watchdog Competition Commission of India (CCI)’s approval of their $8.5 billion merger, according to a press release issued by the Press Information Bureau (PIB).
“Commission approves the proposed combination involving Reliance Industries Limited, Viacom18 Media Private Limited, Digital18 Media Limited, Star India Private Limited and Star Television Productions Limited, subject to the compliance of voluntary modifications,” CCI said in a post on X (formerly Twitter).
CCI has not yet specified any voluntary modifications for the original merger deal made by the two companies. As per the PIB release, the competition watchdog is yet to give detailed follow-up of the approval.
Viacom18 has not issued any official statement and Disney India has refused to comment on this matter.
This comes a day after Zee Entertainment and Sony Picture Networks India agreed to settle all disputes over their failed $10 billion merger plan, and a day before Reliance Industries’ 47th annual general meeting (AGM).
In February this year, Viacom18 and Disney India’s Star India announced a merger of their media assets. This merger makes the combined entity India’s largest entertainment conglomerate with a portfolio of 120 channels. The new entity will have 40-45 per cent of the industry, as per Emkay’s analyst report, which was released in February after the announcement of the merger. As per the merger agreement, Reliance Industries will invest approximately $1.4 billion in the new entity, which will compete against Sony, Netflix, Amazon and Zee.
Through this merger Star India will be a joint venture (JV) co-owned by Viacom18 and Disney. Additionally, under the terms of the agreement, Viacom18’s media operations will be merged with Star India through a court-approved scheme.
Reliance and Viacom18 will be holding 63.16 per cent stake in the combined entity, which will have two streaming services. Walt Disney will hold the remaining 36.84 per cent stake.
The JV will also be granted exclusive rights to distribute Disney’s films and productions in India, with a licence to more than 30,000 Disney content assets, as per Emkay’s analyst report.
Earlier, CCI had issued a warning regarding the merger as it raised concerns about the new entity gaining excessive control over cricket broadcasting rights, thereby impacting advertisers. CCI had also posed around 100 questions to both companies regarding the merger.
Nita Ambani will serve as the chairperson of the JV, with Uday Shankar taking on the role of vice chairperson.
First Published: Aug 28 2024 | 8:03 PM IST
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