The Merger Deal
Walt Disney Co. (NYSE:DIS) and Reliance Industries Ltd. have inked a binding agreement to merge their media operations in India. The media unit of Reliance, led by billionaire Mukesh Ambani, and its affiliates are slated to have at least a 61% stake in the combined entity.
Market Speculation
Reports suggest that the stake distribution might still be subject to change based on how Disney’s additional local assets are factored in by the time the deal closes. The overall valuation of the operation is under scrutiny as Disney’s Indian operations have suffered considerable losses, particularly due to a loss of streaming rights for cricket matches.
Financial Implications
Recent media coverage suggests that the preliminary deal between Disney and Reliance Industries values the Indian business at $3.9 billion. This valuation is notably lower than when Disney acquired the unit through its $71.3 billion acquisition of Fox media assets in 2019. At that time, the unit was estimated to be worth between $7 billion and $16 billion.
