RIL to consolidate media and distribution business under Network18
18 Feb 2020
1
Reliance Industries on Monday announced plans to consolidate its media and distribution businesses under Network 18, creating an entity with about Rs8,000 crore in annual revenue and benefit from substantial economies of scale.
The decision to merge TV18 Broadcast, Hathway Cable & Datacom, Den Networks into Network18 Media & Investments was taken at a meeting of the three boards on Monday
Under the scheme of arrangement, 92 shares of Network 18 will be given for every 100 shares of TV18, 78 shares of Network18 for every 100 shares of Hathway and 191/shares of Network18 for every 100 shares of Den.
The broadcasting business will be housed in Network18 and the cable and ISP businesses in two separate wholly owned subsidiaries of Network18.
The Reliance Group's holding in Network18 will reduce from 75 per cent to 64 per cent once the merger is completed.
The Mukesh Ambani led Reliance Industries said the merger will create an entity with about Rs8,000 crore in annual revenue and substantial economies of scale.
"The aggregation of a content powerhouse across news and entertainment (both linear and digital) and the country’s largest cable distribution network under the same umbrella shall boost efficiency and exploit synergies, creating value for all stakeholders," Reliance said in a statement.
TV18 Broadcast owns the largest news network in India under the News18 brand and is also the majority shareholder in the entity that owns the Colors network of entertainment channels and video streaming service Voot. Put together, Hathway and Den are the country's top cable platform, controlling 30 per cent of the market. Network 18 also owns India's top finance app Moneycontrol as well as the country’s largest regional language news destination news18.com.
The combined broadband entity will serve almost a million wireline broadband subscribers.
Network 18 will be the largest listed media company by revenue for the first nine months of the 2019-20 financial year, edging out Zee Entertainment and the Sun TV network.
"An integrated media play shall further increase the breadth as well as depth of the group’s consumer touchpoints, and allow for retaining a larger share of the consumer's spend on content," said Reliance. "The reorganisation furthers the group strategy of building a media powerhouse that is agnostic across pipes, platforms and screens."
Reliance, whose interests include telecommunications, retail, oil, refining, and petrochemicals, has announced a series of steps to de-leverage its businesses and simplify its structure. Last August, Chairman Mukesh Ambani announced the company would be net-debt free by March 2021. Two months later, Reliance consolidated all its digital businesses under a wholly-owned subsidiary.
.webp)
