Disney, Reliance sign binding pact for India media merger: Report
Walt Disney Co. and Reliance Industries Ltd. have inked a binding agreement to merge their media operations in India, reported Bloomberg News quoting people familiar with the development.
The media unit of Reliance and its affiliates are expected to own at least 61 per cent of the merged entity, with Disney holding the rest, added the people quoted in the report.
As of now, none of the two entities have officially released any statement on the deal. However, the sources also said that the signing of the agreement along with other details is likely to be announced this week.
They added that the stake split between the two companies may change at a later stage, depending on how Disney’s other local assets are factored in. It may be noted that Disney owns a minority stake in broadcast service provider, Tata Play Ltd, which Reliance may consider acquiring, as per media reports.
Once the deal becomes official, it will lead to the creation of a formidable media entity in the country.
For Disney, it will be a game changer, given the challenges it has been facing in India over the past few years. The company had been exploring options for its Indian business after facing a slump in revenue and subscribers, including a complete stake sale or setting up a joint venture.
On the other hand, the deal will pave the way for Reliance to expand further in the world’s fastest-growing media and entertainment industry, and take on the likes of Netflix and other streaming giants.
The merger is also expected to create a massive disruption in the sector, especially since the media merger between Sony’s India unit and Zee Entertainment Enterprises fell through due to differences.
