New Delhi: Reliance Industries Limited and The Walt Disney Company have formally entered into binding definitive agreements to establish a joint venture, as announced by RIL on Wednesday, February 28, 2024. This collaboration will amalgamate the operations of Viacom18 and Star India. Under the terms of the agreement, Viacom18’s media business will be merged into Star India Private Limited.
RIL, under the leadership of Mukesh Ambani, will inject Rs 11,500 crore ($1.4 billion) into the joint venture to fuel its growth strategy.
Valuation And Ownership
The valuation of the joint venture stands at Rs 70,352 crore ($8.5 billion) post-money, exclusive of synergies. Following the conclusion of the transaction, RIL will retain control over the new venture, holding a 16.34 percent stake, while Viacom18 and Disney will own 46.82 percent and 36.84 percent, respectively.
Chairperson And Vice Chairman of Merged Entity
Nita Ambani, spouse of Mukesh Ambani, will assume the role of Chairperson of the merged entity, while former senior Disney executive Uday Shankar will serve as Vice Chairperson.
Merged Ventures
The joint venture aims to become a premier destination for television and digital streaming services, offering a wide array of entertainment and sports content in India. It will bring together renowned media properties such as Colors, StarPlus, StarGOLD, Star Sports, and Sports18, along with access to highly anticipated events across television and digital platforms via JioCinema and Hotstar. With a combined audience of over 750 million viewers in India, the JV will also cater to the global Indian diaspora.
Digital Transformation
The company envisions leading the digital revolution in the Indian media and entertainment sector, providing consumers with high-quality and comprehensive content accessible anytime, anywhere.
Exclusive Rights
Moreover, the merged entity will secure exclusive rights to distribute Disney films and productions in India, along with licenses for over 30,000 Disney content assets, thus offering a comprehensive entertainment portfolio to Indian consumers.
Top Officials Statement
Mukesh Ambani, Chairman and Managing Director of RIL, described the agreement as a landmark deal that signifies a new chapter in the Indian entertainment industry. He expressed excitement about the strategic partnership with Disney, aiming to deliver unmatched content to audiences nationwide at affordable prices.
Bob Iger, CEO of The Walt Disney Company, expressed enthusiasm about the prospects of the joint venture in India, emphasizing the country’s vast market potential. He highlighted Reliance’s deep understanding of the Indian market and consumer preferences, foreseeing the creation of a leading media company to serve consumers with a broad range of digital services and entertainment content.
The completion of the transaction is contingent upon regulatory, shareholder, and customary approvals and is anticipated to occur in either the final quarter of Calendar Year 2024 or the initial quarter of Calendar Year 2025. Goldman Sachs is serving as the financial and valuation advisor for the deal.
Uday Shankar, Co-founder of Bodhi Tree Systems, expressed gratitude for the opportunity to strengthen the partnership with Reliance, now extended to include Disney. He emphasized the commitment of all parties involved to deliver exceptional value to audiences, advertisers, and partners, envisioning the joint venture as a pivotal force shaping the future of entertainment in India in alignment with the vision of Digital India championed by the Honorable Prime Minister.