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India’s Reliance inks deal with Disney to create media giant

The conglomerate led by billionaire Mukesh Ambani will be the majority shareholder in the merged entity, worth $8.5bn

Indian mega-conglomerate Reliance has struck a deal with the Walt Disney Company to merge their TV and video streaming businesses into a new entity valued at $8.5 billion. With over 750 million viewers across 120 channels and two streaming platforms, the venture combining Reliance’s Viacom18 and Disney’s Star India will become the largest media network in the world’s most populous nation.

The deal, announced on Wednesday after months of talks, still requires regulatory approval but will be completed by early next year at the latest, the companies stated. The joint venture will be controlled by Reliance, while ownership will be divided between Reliance Industries (16.34%), Viacom18 (46.82%), and Disney (36.84%).

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Viacom18 was created in 2007 as a partnership between Reliance and American multinational company Paramount. It currently runs about 40 channels, including the JioCinema streaming service, and is seen as the biggest competitor to Disney’s streaming ambitions in India.

Disney inherited the Star business when it purchased entities from Rupert Murdoch’s Fox in 2019. Its valuation, however, has since plunged to about one-third of what it was worth when Disney took over, according to Reuters.

Reliance, headed by Asia’s richest man, Mukesh Ambani, has also pledged to inject $1.4 billion to help the firm grow. Ambani’s wife Nita Ambani, the director of Reliance Industries, will serve as the chairperson of the new entity.

The two companies said the merger would offer more domestic and global entertainment content, as well as live sports streaming services. After the announcement, Disney CEO Bob Iger vowed to create one of the country’s “leading media companies,” while Ambani described it as “a new era in the Indian entertainment industry.” 

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The move comes against the backdrop of flagging support for Disney’s Hotstar streaming platform in India. Launched in 2015, the service reported a loss of 2.8 million paid subscribers for the fourth quarter last year. In a big jolt to Disney, Reliance picked up rights for the highly lucrative Indian Premier League (IPL) cricket tournament in 2022, sparking a mass exodus from the Disney-owned platform.

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