Reliance Industries, Walt Disney To Merge Media Businesses In India

Walt Disney and Reliance Industries, two major companies, have decided to join hands in India. This involves combining their media businesses in our country. Last week in London, these companies agreed to start the process of merging their media operations in India. 

This agreement is a major move, as it will create one of India's largest media companies. This new company will be a big player, challenging other major media houses like Zee Entertainment, Sony, and popular streaming services like Netflix and Amazon Prime.

The structure of this deal is quite interesting. Reliance Industries will hold a majority, with a 51% share, while Disney will have 49%. This means Reliance will have a bit more control over the new company. They plan to complete this big merger by February.

Key people like Kevin Mayer, a former Disney executive, and Manoj Modi, advisor to Mukesh Ambani, have been working hard to make this deal happen. They have been in discussions for months.

Now, they will start valuing the businesses and working out the detailed legal aspects. They might also have a period of about 45 to 60 days where they agree not to talk to other companies about similar deals.

A significant part of this merger involves RIL's media arm, Viacom18, and Disney's Star India. They might combine these through a stock swap, and there might be some cash involved too. Jio Cinema, a part of Reliance, will also be included in this deal.

For Disney, this merger is beneficial, especially for their Hotstar app, which has been losing money. The CEO of Disney mentioned they want to improve their financial performance in India.

Finally, both Disney and Reliance are planning to invest significant money, possibly around $1 to $1.5 billion, into this new venture. The board of the new company will have directors from both Reliance and Disney, and they are considering adding independent directors too.