Reliance Industries Limited (RIL) and Walt Disney Company have officially announced a merger in India on Wednesday, 28th February. The value of the merged entity has been pegged at $ 8.5 billion.
Reliance announced that part of the media undertaking, Viacom 18 will be merging into Disney-owned Star India Private Limited (SIPL), through a court-approved scheme of arrangement. The joint venture (JV), will be dominated by RIL with 46.82 percent ownership held by Viacom 18 and 36.84 percent by Disney, showing that Reliance and its affiliates together will own more than 60 percent stake in the company. RIL will inject $1.4 billion into the venture to support its growth strategy.
Reliance and Disney create a Juggernaut in the Entertainment Industry
The juggernaut of Reliance and Disney is prone to dominate both television and digital streaming space in India.
“The JV will be one of the leading TV and digital streaming platforms for entertainment and sports content in India, bringing together iconic media assets across entertainment,” said the companies in a joint statement.
Together, Reliance and Disney entity will have 120 TV channels and two streaming platforms. Brands like Colors, StarPlus, StarGOLD, Star Sports, and Sports18 will be working under the same roof, along with access to highly anticipated events via Jio Cinema and Hotstar, and expect over 750 million viewers in India.
The merger is likely to create a daunting competition against Japan’s Sony, Netflix, and India’s Zee Entertainment in the $28 bn media and entertainment industry.
The Merger – An Expansion for Reliance and Relief for Disney
This merger with Reliance comes as a relief to Disney as it was struggling to retain users in India.
Disney relieved 
Bob Iger resumed as CEO of Disney in November 2022, less than a year after retiring, and has been trying to restructure the company since then. Disney misjudged the Indian market and was struggling, Iger in November said the company wants to stay in the Indian space and is considering its options.
Disney first acquired Indian streaming services such as Hotstar and Star TV channels in 2019. Then it acquired streaming rights to the Indian Premier League (IPL) in 2020 and charged for cricket on Hotstar. It was expected to reach over 100 million users within a year.
However, this dream of Disney was shattered as Ambani took IPL rights in 2022 and streamed games for free. Disney lost 61.3 million Hotstar subscribers in October 2022 and 23 million by December.
Reliance : 
For Reliance, the merger will help it to expand further in the media and entertainment business of India.
According to Jeffries, it will also increase the per share value by Rs. 40.
“This is a landmark agreement that heralds a new era in the Indian entertainment industry. We have always respected Disney as the best media group globally and are very excited at forming this strategic joint venture that will help us pool our extensive resources, creative prowess, and market insights to deliver unparalleled content at affordable prices to audiences across the nation. We welcome Disney as a key partner of Reliance Group,” said Mukesh Ambani after the deal.
Reportedly, a billionaire Mukesh Ambani’s wife Nita Ambani will be chairperson of merged entity and Uday Shankar will be vice chairperson.
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