Viacom18 Disney Merger: On one hand, the merger of Zee and Sony has broken down. At the same time, Indian industrialist Mukesh Ambani has played a big gamble. There is talk of merger of Disney India with Reliance Industries’ media venture Viacom 18.
According to a CNBC report, Reliance and Disney are in talks to merge their Indian media businesses, in which Reliance is set to take a 51%-54% stake. The domestic business of the American company in India is 3.5 billion dollars.
Viacom 18 will become a powerful media house
Reliance and Disney own a major streaming service as well as 120 television channels. The merger of the two will lead to the emergence of a big and powerful media house in the Indian entertainment world. Under the deal, Reliance Industries’ broadcasting division Viacom will merge with 18 Disney India businesses.
Disney India’s assets are declining
Meanwhile, Disney’s India assets have halved to $4.5 billion, from less than $10 billion previously, Bloomberg reported this week. The reason for the decline in the valuation of Disney’s India unit is Zee Entertainment’s withdrawal from the $1.4 billion deal. Now Disney Star is reportedly considering legal action against Zee for canceling a $1.4 billion sub-licensing agreement for TV telecast of international cricket matches in India.
Disney may take legal action for compensation
If the voided agreement contains an arbitration clause, Disney Star will have to resort to arbitration proceedings to resolve the dispute and if the agreement lacks an arbitration clause, initiate legal proceedings to sue Disney for damages. Can do. ZEEL has already failed to pay the first installment of around US$200 million. On August 30, 2022, ZEEL announced entering into a strategic licensing agreement with Disney Star for television broadcast rights of ICC Men’s and Under-19 global events for a period of four years.