In a significant development within the entertainment industry, Reliance Industries Limited (RIL) and Walt Disney Co have reportedly finalized a binding agreement to merge their media operations in India, as stated by Bloomberg. Under this agreement, Reliance’s media unit and its affiliates are poised to hold a minimum of 61% stake in the merged entity, while Disney will retain the remaining shares.
Reports suggest that Disney has agreed to divest 61% of its India business to Viacom 18 at a valuation of $3.9 billion (approximately Rs 33,000 crore). Viacom18, owned by Reliance Industries Limited (RIL) Chairman Mukesh Ambani, will acquire this substantial stake from Disney, marking a significant transaction in the Indian media and entertainment landscape.
Earlier speculations had indicated Disney’s intent to sell 60 percent of its Indian business to Viacom18. This deal is expected to reshape the dynamics of the Indian media and entertainment sector. Notably, Sony of Japan’s proposed merger with Zee Entertainment fell through recently due to disagreements over leadership issues.
Meanwhile, facing pressure from activist shareholder Nelson Peltz regarding succession planning, Disney has appointed two new directors, James Gormon, CEO of Morgan Stanley, and Sir Jeremy Darroch, former group chief executive at Sky, in late November. Disney CEO Iger, during an earnings call in November, expressed the company’s commitment to India and its plans to enhance its presence in the country to bolster financial performance.
This marks Disney’s third foray into the Indian market, with previous attempts including alliances with KK Modi’s Group in 1993 and an acquisition of Ronnie Screwvala’s UTV, both of which did not yield the expected results. Investor sentiment towards Disney’s India business waned in 2022, particularly after losing online streaming rights for the popular IPL tournament from 2023 to 2027, despite securing broadcast TV rights successfully.
