Reliance, Disney to consolidate media operations in India

Reliance Industries is reported to have signed a non-binding agreement with Walt Disney Company for merger of their media operations in India. The idea is to create a joint venture with RIL holding a majority 51 per cent stake. 

A combination of the media operations of Reliance and Disney would result in the creation of the country's largest media company that would compete with the likes of Sony, Zee Entertainment etc.

The merged entity would also be able to offer viewers a richer and diverse television broadcasts with cutting-edge streaming services, igniting fresh competition.

Reliance Group entities like JioCinema and Viacom18 are expected to be part of the merged entity, absorbing a substantial portion of Star India's stock. 

RIL is planning to keep Viacom18 as a step-down subsidiary, absorbing Star India through a stock swap, say reports. 

Both Disney and Reliance are also expected to inject fresh capital, with reports pointing to likely cash injection of $1-1.5 billion.

The board of the combined entity is expected equal representation from Reliance and Disney, with at least two directors each from Reliance and Disney, besides two independent directors.

The combined strengths of Reliance and Disney are expected to bring forth a diverse array of content, leveraging the synergies between Viacom18 and Jio Cinema. 

The two sides are currently working on the details of the merger deal, including valuation and regulatory issues, according to reports.

The merger deal comes after Disney India lost out to JioCinema on the online rights to the IPL tournament from 2023-27, even as it won the broadcast TV rights. 

The 51:49 stock-and-cash merger deal is expected to be completed by February.