Disney & Reliance Complete $8.5B Deal To Form Indian Entertainment Giant

Disney and Reliance Industries have completed the $8.5B deal to form a media and entertainment giant in India.

This brings together Reliance’s JioCinema business with Disney’s Star India, which houses Disney+ Hotstar, under one roof. No name has been set for the joint venture just yet, but it is now operational after approval from the the Hon’ble NCLT Mumbai, Competition Commission of India and other regulatory authorities.

The transaction is valued at ₹70,352 crore ($8.5B) on a post-money basis, excluding synergies. Reliance will effectively be in control of the venture, owning 16.34% directly and another 46.82% through Viacom18, which is consolidated earlier this year. Disney will have the remaining 36.84%. Industry giant Reliance is planning to pump ₹ 11,500 crore into the JV.

Reliance’s Nita M. Ambani will be the Chair of the JV, with Indian dealmaker and former Disney Indian boss Uday Shankar, who runs Bodhi Tree Systems with James Murdoch, named Vice Chairperson to provide strategic guidance. A trio of CEOs will oversee different elements of the business with Kevin Vaz taking on the entertainment organization across platforms, Kiran Mani leading the combined digital operation and Sanjog Gupta taking on sports.

According to the partners, the new biz will be one of the largest media and entertainment companies in India with pro forma combined revenues of approximately ₹26,000 crore ($3.1 billion) for the fiscal year ended in March 2024. It will operates over 100 TV channels, including major networks Stars and Colors, and produce more than 30,000 hours of TV entertainment content annually, while the JioCinema and Hotstar streaming platforms have an aggregate subscription base of over 50 million. It will own most of Indian cricket rights, along with football and other sports.

Separately to the JV’s formation, Reliance has bought out Paramount Global’s 13.01% stake in Viacom18 for ₹4,286 crore. This gives it 70.49% of the Viacom18, with Network18 Media & Investments and owning 13.54% and Body Tree the other 15.97%.

Reliance is India’s biggest private company, with consolidated revenues of nearly $120B, cash profit of $17B and net profit of $9.5B for the year ended March 31, 2024. Disney’s annual revenue was $88.9B for the 2023 financial year.

“This is an exciting moment for our two companies, as well as for India’s consumers, as we create one of the top entertainment entities in the country through this joint venture,” said Bob Iger, CEO of The Walt Disney Company. “By joining forces with Reliance, we are able to expand our presence in this important media market and deliver viewers an even more robust portfolio of entertainment, sports content, and digital services.”

Mukesh D Ambani, Chairman & Managing Director of Reliance Industries, added: “With the formation of this JV, the Indian media and entertainment industry is entering a transformational era. Our deep creative expertise and relationship with Disney, along with our unmatched understanding of the Indian consumer will ensure unparalleled content choices at affordable prices for Indian viewers. I am very excited about the JV’s future and wish it all the success.”

Bodhi Tree’s Shankar said: “James and I are excited to be partners in this journey to disrupt the media and entertainment industry in India. The new organisation is committed to deliver an unprecedented level of creativity, disruption and new age consumer experience.

“As media consumption continues to move to an integrated TV-digital ecosystem, the merger of Viacom18 and Star India offers a unique opportunity to reorient the industry to better serve diverse cohorts of consumers across the country. Together, we aim to build India’s largest integrated media platform which will deliver unparalleled experiences in innovative and exciting ways.”