Disney, Reliance Sign Binding Media Pact: Report

It appears that the deal between Reliance Industries (RIL) and Walt Disney, touted as among the biggest deals in the media and entertainment sector, has seen progress as the two conglomerates sign a binding pact, impacting their operations in India. 

Last year, Disney and Reliance signed a non-binding agreement, according to which Reliance held a 51 per cent shareholding while Disney was at 49 per cent. This situation seems to have changed. Industry sources indicated that a potential downgrade of Disney Star’s valuation was being discussed. Reasons cited included the falling out of the sub-licensing ICC deal with Zee Entertainment Enterprises. 

As per a Bloomberg report, in the binding pact signed now, Reliance and its affiliates are expected to own at least 61 per cent of the merged entity, with Disney holding the rest. 

Last month, The Wall Street Journal also reported that Viacom18, backed by Reliance, Paramount Global and James Murdoch’s Bodhi Tree Systems, is set to take a 60 per cent stake in Disney’s operations in India.

Disney and Reliance have been tough rivals in India. Disney faced the loss of rights to content, such as the Indian Premier League and Warner Brothers, to Mukesh Ambani’s JioCinema. With this binding merger pact, the impact will be beyond the two companies as the competition landscape, which would have impacted pricing of broadcasting rights, advertising prices and the like will all be affected.