Reliance to acquire over 50% stake in Disney India
What's the story
Reliance Industries and Disney India are working out their merger plans, with Reliance potentially acquiring a 51%-54% stake, valuing Disney's local operations at $3.5 billion. Additionally, Bodhi Tree, a joint venture between James Murdoch and Uday Shankar, may acquire around 9% in the merged entity. Reuters reported that the companies aim to finalize a binding agreement in February.
New entity
Reliance-Disney merger to create entertainment superpower in India
The proposed merger would unite Reliance Industries's Viacom 18 broadcast division with Disney India, forming an entertainment powerhouse in the country. Together, they boast major streaming services and a combined total of 120 television channels. This development comes as Disney's India assets have dropped to $4.5 billion, significantly less than the $10 billion previously sought by the US entertainment giant. The reduction in assets is attributed to Zee Entertainment ending a $1.4 billion deal after its failed merger with Sony.
Fresh troubles for Zee
Troubles mount for Zee as Disney mulls legal action
Meanwhile, Disney is reportedly weighing legal action against Zee Entertainment for canceling the $1.4 billion sub-licensing agreement for TV broadcast of international cricket matches in India. If the terminated agreement included an arbitration clause, Disney would need to pursue arbitration proceedings to resolve the dispute. Otherwise, Disney could initiate legal proceedings to sue Zee for damages.
Zee-Disney dispute
Zee misses first instalment of licensing agreement with Disney Star
Zee has already failed to pay the first instalment of approximately $200 million and informed Disney that it does not plan to proceed with the agreement. On August 30, 2022, Zee announced a strategic licensing agreement with Disney for television broadcasting rights of ICC Men's and Under-19 global events for a four-year period.