RIL, Disney Joint Venture To Merge India Entertainment Business Gets EU Approval
The European Commission’s approval for Reliance and Disney joint venture, Star India, marks a pivotal merger in India’s entertainment industry, combining assets from Viacom18, StarPlus, and JioCinema.
The European Union on Thursday approved the formation of a joint venture by Reliance Industries Ltd. and Walt Disney Co. for the merger of their entertainment business in India.
The approval for the joint venture, named Star India Pvt., was granted by the European Commission, which is the executive arm of the EU.
"The European Commission has approved, under the EU Merger Regulation, the creation of a joint venture Star India Private Limited (SIPL) by Reliance Industries Limited, both of India, The Walt Disney Company of the US, and BTS Investment 1 Pte. Ltd. of Singapore," an official press note stated.
The transaction relates primarily to the entertainment sector in India, it added.
"The Commission concluded that the notified transaction would not raise competition concerns, given that the joint venture has negligible activities in the European Economic Area and the companies' limited combined market position resulting from the proposed transaction," it further said.
As per the amalgamation plan, the businesses of Disney India and Viacom18—the media arm of RIL—will be merged into Star India Pvt. The combined entity will be valued at Rs 70,000 crore.
RIL will hold a 63.16% stake and invest Rs 11,500 crore into the joint venture, focusing on expanding the OTT business. Disney will own the remaining 36.84% share. Nita Ambani, the wife of RIL chief Mukesh Ambani, will chair the venture, and former Walt Disney executive Uday Shankar will serve as vice chairperson.
The proposed amalgamation received a nod from India's National Company Law Tribunal in August. Earlier, the Competition Commission of India also sanctioned the merger.
The JV will bring together some of the leading entertainment and sports channels like Colours, StarPlus, Star Sports, and Sports 18, in addition to digital platforms like JioCinema and Hotstar. The JV will have over 750 million viewers across India, according to Walt Disney.
Shares of RIL settled 0.89% lower at Rs 1,332 apiece on the National Stock Exchange, compared to a 0.56% decline in the benchmark Nifty 50.
