Sat. May 21st, 2022

James Murdoch and former Disney CEO Uday Shankar are in late-stage talks to acquire a stake in Viacom18, a media and entertainment company jointly owned by Mukesh Ambani’s Reliance Industries and ViacomCBS.

With the value of Viacom18 at about $ 4 billion, the deal to acquire nearly 40 percent will bring in $ 1.6 billion in new investment for the broadcaster. This would come from the new shareholders as well as Reliance Industries, which owns 51 percent of Viacom18 through its company Network18.

A potential deal, first reported by India’s Economic Times, was confirmed by two people close to the deal. Viacom18 did not immediately respond to a request for comment, and ViacomCBS declined to comment.

The move comes during an era of consolidation for India’s entertainment and sports broadcasters, with a recent merger of Zee Entertainment and Sony creating one of India’s biggest media conglomerates, just like streaming the way India watches everything from Bollywood movies to cricket matches.

If an agreement continues, new funding and new investors will “add significant cuts to Viacom18 across key segments of India’s $ 10 billion video landscape,” said Mihir Shah, vice president of consulting firm Media Partners Asia. “The Zee-Sony merger and now this deal will recalibrate and rejuvenate the video landscape and make the transition to streaming even more competitive.”

The connection is expected to build on Reliance’s Jio mobile network, which has more than 400 million subscribers in India, to create opportunities to develop primarily first-rate services, according to a person familiar with the deal.

This will strengthen the entertainment and media business of the oil-to-telecommunications conglomerate Reliance, India’s largest company by turnover. Led by Ambani, Asia’s richest man and chairman of the group, Reliance has transformed India’s mobile telecommunications industry by using price reductions to outperform competitors and ultimately gain the largest market share.

In Network18, Reliance has a stable of TV channels, news outlets, movie theaters and entertainment studios. Meanwhile, Viacom18 bought rights for the American basketball league, the NBA, as it increases offers for a sports channel that can compete with Sony-Zee, who plans to bid for Indian Premier League cricket rights.

Son of media mogul Rupert Murdoch, James Murdoch broke away of the family business after the Murdoch empire split with the sale of the bulk of 21st Century Fox to Disney. He then set up investment firm Ground systemswhich has supported a handful of companies, including Vice Media.

Lupa’s Indian entity, which has invested in several educational ventures, is backed by Shankar, former president of Disney Asia-Pacific. Lupa Systems declined to comment. Shankar could not be reached for comment.

Additional post by Anna Nicolaou in New York

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