MUMBAI: It has taken its time to take its form, but it’s finally got there. Reliance Industries Limited (RIL), Viacom 18 Media (Viacom18) and The Walt Disney Co (Disney) today announced that following the approval by the NCLT Mumbai, Competition Commission of India (CCI) and other regulatory authorities, the merger of the media and JioCinema businesses of Viacom18 into Star India Pvt Ltd (SIPL) has become effective (the JV). In addition, RIL has invested Rs 11,500 crore ($ 1.4 billion) into the JV for its growth. The latter has in turn allotted shares to Viacom18 and RIL as consideration for the assets and cash, respectively.
The transaction values the JV at Rs 70,352 crore (US$ 8.5 billion) on a post-money basis, excluding synergies. At the closing of the transactions noted above, the JV is controlled by RIL and owned 16.34 per cent by RIL, 46.82 per cent by Viacom18 and 36.84 per cent by Disney.
Nita M. Ambani will be the chairperson of the JV, with Uday Shankar as vice chairperson providing strategic guidance to the JV.
The JV is home to the most iconic and engaging media brands in India across TV and digital platforms. The combination of Star and Colors on the television side and JioCinema and Hotstar on the digital front will provide extensive choice of content across entertainment and sports to viewers in India and globally.
A press release issued by the trio hailed the JV as heralding a new era in India’s entertainment industry for consumers. This unique joint venture of Reliance and Disney brings together the companies’ content creation and curation prowess, world-class digital streaming capabilities along with a digital first approach that will help the JV deliver unparallelled content choices at affordable prices to Indian viewers and the Indian diaspora globally.
The JV will be one of the largest media and entertainment companies in India with pro forma combined revenue of approximately Rs 26,000 crore (US$ 3.1 billion) for the fiscal year ended in March 2024. The JV operates over 100 TV channels and produces 30,000 plus hours of TV entertainment content annually. The JioCinema and Hotstar digital platforms have an aggregate subscription base of over 50 million. The JV holds a portfolio of sports rights across cricket, football and other sports.
The CCI approved the transaction on 27 August 2024, subject to the compliance with certain voluntary modifications offered by the parties. Apart from the CCI, the transaction has been approved by anti-trust authorities in the EU, China, Turkey, South Korea and Ukraine.
“With the formation of this JV, the Indian media and entertainment industry is entering a transformational era,” said RIL chairman & managing director Mukesh Ambani. “Our deep creative expertise and relationship with Disney, along with our unmatched understanding of the Indian consumer will ensure unparalleled content choices at affordable prices for Indian viewers. I am very excited about the JV’s future and wish it all the success.”
“This is an exciting moment for our two companies, as well as for India’s consumers, as we create one of the top entertainment entities in the country through this joint venture,” said Disney CEO Bob A. Iger. “By joining forces with Reliance, we are able to expand our presence in this important media market and deliver viewers an even more robust portfolio of entertainment, sports content, and digital services.”
“James and I are excited to be partners in this journey to disrupt the media and entertainment industry in India. The new organisation is committed to deliver an unprecedented level of creativity, disruption and new age consumer experience,” said Bodhi Tree Systems co-founder Uday Shankar. “As media consumption continues to move to an integrated TV-digital ecosystem, the merger of Viacom18 and Star India offers a unique opportunity to reorient the industry to better serve diverse cohorts of consumers across the country. Together, we aim to build India’s largest integrated media platform which will deliver unparalleled experiences in innovative and exciting ways.”
Media observers agree. Says one of them: “This is a win-win for both the Mukeshbha-run RIL and Disney. The have the extremely skilled and talented Uday Shankar on their side of the fence. They can only grow in strength from hereon. And their opponents in the sector - Zee, Sony, Warner Bros Discovery, Sun TV , Google, Netflix, Amazon Prime Video, Microsoft - look like midgets compared to the giant that has been created. For sure, in the coming years we are going to see attempts by the others to agglomerate and get scale for themselves. Not just consumers the entire sector is in for shakeups and exciting times.”
