Reliance, Disney Initiate Antitrust Examination For India Media Merger

Mukesh Ambani-led Reliance Industries and New York Stock Exchange-listed company Walt Disney have reportedly appointed law firms and initiated antitrust due diligence for their proposed merger in the Indian media and entertainment sector.

Reliance has roped in Indian law firms Khaitan & Co and Shardul Amarchand Mangaldas, while Disney has engaged AZB & Partners, Reuters reported, citing sources close to the matter.

The development comes months after reports emerged in October last year that Reliance Industries was set to acquire a majority stake in Walt Disney Co.’s India business in a cash and stock deal where Walt Disney might sell a controlling stake in the Disney Star business, which it values at around $10 Bn.

Last month, the companies reportedly signed a non-binding term sheet in London. The acquisition is likely to result in Reliance setting up a new subsidiary that would absorb Disney’s Star India through a share swap deal. JioCinema would also be included in the deal.

The merger would reportedly include an immediate capital investment of about $1-1.5 Bn. The new entity’s board is anticipated to have equal representation from both the companies, with at least two directors from each. 

As per the latest Reuters report, Reliance has called the story “speculative”, without elaborating on the matter further.

Meanwhile, the work on the antitrust review of the Reliance-Disney merger is in the initial stages, as per sources. 

Disney’s India business has been struggling as with Reliance dominating its presence in the OTT market, particularly by offering free streaming of Indian Premier League cricket (IPL). Disney Hotstar used to hold the right of this broadcast earlier.

Currently, Reliance’s JioCinema app has the rights to broadcast IPL while the Disney Hotstar app owns the rights for International Cricket Council’s (ICC) matches in India until 2027.

Amid significant competition from Reliance, Disney+ Hotstar also stopped streaming HBO content in India last year.

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