May 25th 2024.
In a recent development, Reliance Industries, headed by billionaire Mukesh Ambani, has submitted a request to the Competition Commission of India for approval of their proposed $8.5-billion merger between Viacom18 and Star India Pvt Ltd. This merger would bring together the entertainment businesses of Viacom18, which is a part of the Reliance Industries Ltd group, and SIPL, which is fully owned by The Walt Disney Company.
According to the notice filed with the CCI on Friday, this transaction would result in SIPL becoming a joint venture, with RIL, Viacom18, and existing TWDC subsidiaries holding joint ownership. Reliance Industries has stated that this merger would not have any significant adverse effect on competition in India. However, to assist the CCI in their assessment, they have highlighted certain key markets where there may be overlaps, such as audio visual content rights, distribution of broadcast TV channels, and advertising space in India.
SIPL, a US-based media company, is involved in various media activities such as TV broadcasting, motion pictures, and operating an OTT platform. On the other hand, Viacom18 is primarily engaged in broadcasting TV channels and operating an OTT platform, both in India and globally. They also have a presence in the production and distribution of motion pictures.
This merger between Reliance Industries and The Walt Disney Company was announced in February of this year, with the aim of creating a Rs 70,000 crore behemoth in the Indian media and entertainment sector. Upon completion, the combined entity will have over 100 channels in multiple languages, two leading OTT platforms, and a viewer base of 750 million across the country.
The joint venture will be chaired by Nita Ambani, wife of Reliance Industries Chairman Mukesh Ambani, while Uday Shankar will serve as the Vice Chairperson. Reliance and its affiliates will hold a 63.16% stake in the new entity, while Disney will have a 36.84% shareholding. Furthermore, Reliance has committed to investing around Rs 11,500 crore into the joint venture to strengthen the OTT business.
Overall, this merger is expected to bring about significant growth and opportunities in the Indian media and entertainment industry, and the companies involved are confident that it will not have any negative impact on competition within the market.
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