India's competition regulator has approved Reliance Industries Ltd's Rs 70,350-crore merger with Disney's Indian media assets, provided certain voluntary moderations are made, covering the way for a major media powerhouse.
"Commission approves the proposed combination involving Reliance Industries Ltd, Viacom18 Media Pvt Ltd, Digital18 Media Ltd, Star India Pvt Ltd and Star Television Productions Ltd, subject to the compliance of voluntary modifications," the Competition Commission of India (CCI) said in a social media platform on X.
In an interview with CNBC-TV18, Dharmendra Kumar, former chairperson of the CCI, stated that the elective moderations vowed by the parties will ease the prompt regulatory access.
“This is a very significant development, as it will lead to a large entertainment conglomerate with a large viewership base,” Kumar said.
Kumar registered that the CCI was probably anxious about the creation of a influenced player in the cricket broadcasting market. He also mentioned that the proposed moderations were likely deliberately to prevent any negative effects on competition and to ensure wider ingress to cricket coverage throughout India.
Disney-Star holds the exclusive digital and TV rights to ICC events from 2024 to 2027 and IPL broadcasting rights from 2023 to 2028, while Jio has secured the IPL streaming rights.
The CCI's approval comes just before Reliance Industries' 47th AGM on August 29, setting the stage for the annual shareholders' meeting.
In February, Viacom18, a subsidiary of Reliance Industries, and Disney's Star India merged their media operations to form India’s largest TV and digital streaming entity. According to the pact, Viacom18’s media operations will be combined with Star India Pvt Ltd (SIPL) through a court-approved arrangement. The joint venture, valued at Rs 70,350 crore ($8.5 billion) on a post-money basis, will see RIL invest Rs 11,500 crore ($1.4 billion) to assist its growth strategy.
The Reliance-Disney merger will rival Sony, Netflix, and Amazon, encompassing 120 TV channels and two streaming services.
The new board will consist of 10 members: five nominated by RIL, three by Disney, and two individualistic directors. The merger is supposed to be finalized in the last quarter of 2024 or the first quarter of 2025.
Nita Ambani will serve as Chairperson of the merged organizations, while former Walt Disney executive Uday Shankar will take on the role of Vice Chairperson.
The joint venture's ownership will be divided with RIL holding 16.34 percent, Viacom18 46.82 percent, and Disney 36.84 percent, with RIL maintaining control according to the merger terms.
On August 28, RIL's shares remained relatively stable at Rs 2,999 on the NSE, with the CCI's announcement coming after trading ended in Mumbai.
