India’s competition regulator has given the green light to Reliance Industries Ltd’s massive Rs 70,350-crore merger with Disney’s Indian media assets. This approval is contingent on certain voluntary changes proposed by the companies, setting the stage for the creation of a major media conglomerate.
The Competition Commission of India (CCI) announced the approval on social media, stating, "The commission has approved the merger involving Reliance Industries Ltd, Viacom18 Media Pvt Ltd, Digital18 Media Ltd, Star India Pvt Ltd, and Star Television Productions Ltd, provided the parties adhere to the agreed voluntary modifications."
C-2024/05/1155 Commission approves the proposed combination involving Reliance Industries Limited, Viacom18 Media Private Limited, Digital18 Media Limited, Star India Private Limited and Star Television Productions Limited, subject to the compliance of voluntary modifications. pic.twitter.com/S2JVzw2VgR
— CCI (@CCI_India) August 28, 2024
Dharmendra Kumar, former chairperson of the CCI, explained that these voluntary changes will likely speed up the regulatory process. "This development is quite significant as it will result in a large entertainment group with an extensive viewership," Kumar noted.
He added that the CCI might have been concerned about the formation of a dominant player, particularly in cricket broadcasting. The modifications were probably aimed at preventing any negative effects on competition and ensuring more widespread access to cricket coverage across India.
This announcement comes just before Reliance Industries' 47th annual general meeting. Earlier this year, in February, Reliance’s subsidiary Viacom18 and Disney’s Indian unit, Star India, announced their plan to merge. This move will create one of India’s largest television and digital streaming platforms.
The merger will involve combining Viacom18’s media operations with Star India Pvt Ltd through a court-approved process. Valued at Rs 70,350 crore (approximately $8.5 billion), Reliance will invest Rs 11,500 crore (about $1.4 billion) into the joint venture to fuel its growth.
Once completed, the Reliance-Disney alliance will rival major players like Sony, Netflix, and Amazon, operating 120 TV channels and two streaming services.
The new board will consist of 10 members: five from Reliance, three from Disney, and two independent directors. The merger is expected to be finalized by the end of 2024 or early 2025.
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Nita Ambani will be the Chairperson of the merged company, while former Walt Disney executive Uday Shankar will serve as Vice Chairperson.
The ownership of the joint venture will be split with Reliance holding 16.34 percent, Viacom18 at 46.82 percent, and Disney owning 36.84 percent, with Reliance maintaining control.
On August 28, Reliance Industries' shares remained steady at Rs 2,999 on the NSE. The CCI’s announcement was made after the trading day ended in Mumbai.
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