MUMBAI: The big fusion has been given the go ahead. The Competition Commission of India (CCI) has approved the proposed merger 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.
The CCI, in its post on the X platform, stated, "C-2024/05/1155 Commission approves the proposed combination involving Reliance Industries Ltd, Viacom18 Media Private Ltd, Digital18 Media Ltd, Star India Private Ltd, and Star Television Productions Ltd, subject to the compliance of voluntary modifications."
This approval was announced just a day before Reliance Industries Ltd's (RIL) 47th annual general meeting.
A press release issued by the CCI later in the evening at 6:34 pm on the Press Information Bureau website stated:
The proposed combination envisages to combine the entertainment businesses (along with certain other identified businesses) of Viacom18, part of RIL group and SIPL, wholly owned by The Walt Disney Company (TWDC). As a result of the transaction, SIPL, currently a wholly owned entity of TWDC through its subsidiaries, shall become a joint venture (JV) which will be jointly held by RIL, Viacom18 and existing TWDC subsidiaries.
RIL, either directly or indirectly, is engaged in several businesses such as exploration and production of oil and gas; petroleum refining and marketing; manufacture and sale of petrochemicals; manufacture and sale of chemicals; organised retail; media and entertainment activities; and telecommunication and digital services in India and worldwide.
Viacom18 is, inter alia, engaged in the business of broadcasting of television (TV) channels, operation of an OTT platform, selling commercial advertisement space on TV channels, licensing of merchandise, and organization of live events in India and worldwide. Viacom18 is also engaged in the business of production and distribution of motion pictures.
SIPL is engaged in a range of media activities including TV broadcasting and the production of AV content and motion pictures, operation of an OTT platform, and selling commercial advertisement space on TV channels and OTT platforms. SIPL is, directly or indirectly, a wholly owned entity of TWDC.
STPL is a company incorporated in the British Virgin Islands and owned, indirectly, by TWDC.
The Commission approved the proposed combination subject to the compliance of voluntary modifications.
Detailed order of the CCI will follow.
Earlier in February 2024, RIL's subsidiary Viacom18 and Disney’s Indian unit, Star India, had unveiled plans for merging their businesses, setting the stage for the creation of one of the largest TV and digital streaming platforms in India.
Under the merger arrangement, Viacom18's media operations will be integrated with Star India Pvt Ltd (SIPL) through a scheme of arrangement approved by the court. The joint venture, which is valued at Rs 70,350 crore (approximately $8.5 billion) on a post-money basis, involves an infusion of Rs 11,500 crore (about $1.4 billion) by RIL to support the new entity's growth strategy.
The combined entity will position itself to compete with major players like Sony, Netflix, and Amazon, boasting a portfolio of 120 TV channels and two streaming platforms. The new board of directors will comprise 10 members, with five nominated by RIL, three by Disney, and two serving as independent directors.
Nita Ambani is set to be the chairperson of the merged entity, while Walt Disney former executive Uday Shankar, will serve as vice chairperson. The merger is projected to be finalised between the last quarter of 2024 and the first quarter of 2025.
Ownership in the joint venture will be structured as follows: RIL will hold a 16.34 per cent stake, Viacom18 will own 46.82 per cent, and Disney will have a 36.84 per cent share, according to the merger agreement's terms.
On 28 August, following the announcement, RIL’s shares remained steady, closing at Rs 2,999 per share. Notably, the CCI's approval was announced after trading hours.
