Reliance-Disney Come Together: The Biggest Media Powerhouse In Making?

Reliance Industries Ltd (RIL) and The Walt Disney Company have announced a landmark agreement to merge their media operations in India. The move signals a significant shift in the landscape of the country's media and entertainment industry.

RIL-Disney Merger Agreement Sealed

In a statement released on Wednesday, Reliance Industries Limited, Viacom18 Media Private Limited, and The Walt Disney Company disclosed the signing of binding definitive agreements to establish a joint venture (JV). This partnership will amalgamate the operations of Viacom18 and Star India, solidifying their presence in the Indian market.

Under the terms of the agreement, the media assets of Viacom18 will be consolidated into Star India Private Limited (SIPL) through a court-approved scheme of arrangement. Additionally, RIL has committed to investing Rs 11,500 crore (~US$ 1.4 billion) into the JV upon closing, aimed at fueling its growth strategy.

Valuation and Ownership Structure

The transaction values the joint venture at an impressive Rs 70,352 crore (~US$ 8.5 billion) on a post-money basis, excluding potential synergies. Following the completion of the merger process, the JV will be under the control of RIL. Ownership will be distributed with RIL holding 16.34%, Viacom18 at 46.82%, and Disney at 36.84%.

Disney has also expressed the possibility of contributing further media assets to the JV, contingent upon obtaining regulatory and third-party approvals. This move could potentially amplify the combined entity's offerings and market reach.

Who Will Lead RIL-Disney JV?

Notably, Nita M. Ambani, a prominent figure within Reliance Industries, will assume the role of Chairperson of the joint venture, underscoring the company's commitment to leveraging its leadership for the success of this collaboration.

The agreement between Reliance Industries and Disney marks a significant milestone in the Indian media and entertainment sector, setting the stage for a formidable player in the industry. With vast resources and expertise at their disposal, the newly formed JV is poised to redefine the landscape of media consumption in the country.

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