The merger has been approved to move forward, pending voluntary modifications.
Merger Alert:
- Variety reports that India’s Competition Commission has officially approved a merger between Reliance Industries Limited and The Walt Disney Company’s entertainment assets in the country.
- The merger was originally announced in February, which is set to combine RIL’s Viacom18 and TWDC’s Star India Private Limited. The transaction will create a joint venture between the media giants.
- RIL, owned by Mukesh Ambani, has an extensive entertainment portfolio.
- Viacom18 comes equipped with TV broadcasting, the JioCinema streaming platform, merchandising and film production and distribution.
- Disney’s SIPL brings its TV broadcasting, content production capabilities, Disney+ Hotstar, and its advertising business to the table. They also bring with them Star Television Productions Limited, which is a Disney entity based in the British Virgin Islands.
- The Competition Commission will require modifications to the merger deal, but have not publicly announced what those restrictions are. However, they have expressed concerns over the media merger’s dominance in cricket rights. Prior to the merger announcement, Disney and RIL battled for multi-year rights for the popular IPL tournament, which resulted in driving up the value of the deal to approximately $6 billion. The two media giants hold almost all of the cricket rights in the country.
- Back in May, the National Company Law Tribunal gave the merger the green light, which allows the two companies to hold a shareholder vote for the deal to go through. It requires 75% of shareholders to agree on the deal.
- The merger would create a media company with assets that could compete with other major players such as Netflix, Zee Entertainment, Sony and Amazon. The company would boast 120 TV channels, two streaming services, and 40% market share of TV and streaming advertisement.
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