In a groundbreaking development reported by The Economic Times on Monday, rumors of a non-binding term sheet being signed have surfaced, paving the way for a potential merger between two media giants, Reliance Industries and Disney India. While there has been no official statement from Reliance Industries, the proposed merger is said to involve a significant restructuring of their Indian media operations.
According to the report, Reliance-owned Viacom18 is poised to establish a step-down subsidiary to absorb a substantial portion of Star India’s stock. The merger structure suggests a 51%-49% share distribution, with Reliance owning 51% and Disney holding 49% of the shares in the post-merger entity. The deal also encompasses io Cinema, owned by Reliance, with the conglomerate expected to remain a dominant stakeholder and potentially securing the controlling stock through cash transactions.
The journey toward this monumental merger began with the signing of the term sheet in the UK last week. The ambitious plan is set to revolutionize India’s media and entertainment landscape, providing a formidable challenge to existing major players like Zee Entertainment, Sony, Netflix, and Amazon Prime.
Despite a desire to finalize the deal by January, industry insiders anticipate that all commercial approvals and regulatory clearances will extend into February. The complex negotiations involved key figures such as Kevin Mayer, a former Disney executive, and Manoj Modi, a trusted aide to Mukesh Ambani, the head of Reliance Industries. If successfully executed, this merger promises to create one of India’s largest entertainment empires, reshaping the country’s viewing and streaming experience.