Industries, along with other investors – notably James Murdoch and Uday Shankar – plan to invest over ₹12,000 crore in the entertainment and sports broadcasting business, responding to an industry consolidation triggered by the Zee-Sony merger.
Murdoch, son of media baron Rupert Murdoch, and Shankar, former Star & Disney India chairman, plan to acquire nearly 40% stake in Viacom18, said highly placed sources close to the transaction.
ViacomCBS, which owns 49% stake in Viacom18, is likely to sell a small part of its stake and get diluted to about 10%, while Reliance Industries-owned
will continue to hold a majority stake, said one of the sources quoted above.
The deal will include primary and secondary infusion of over ₹12,000 crore in Viacom18 from the investors at a valuation of around $4 billion (₹30,000 crore), one of the persons told ET. The bulk of the investment is likely to be by way of primary infusion of funds. Besides the Murdoch-Shankar duo – who are coming in as strategic investor – a few financial investors may also buy stakes.
‘Deal could be Finalised in 2-3 Weeks’
Singapore-headquartered Asia Initiatives, a 51:49 joint venture between Shankar and Murdoch’s private investment company Lupa Systems, is in advanced talks with ViacomCBS and Reliance Industries, whose step-down subsidiary TV18 owns the remaining 51% stake, for the possible transaction, said the people cited.
“Uday Shankar is driving the talks and a deal could be finalised in the next 2-3 weeks,” said one person with direct knowledge of the matter. “ViacomCBS will get diluted to around 10%. Shankar’s entry and fresh funding will give a lot of ammunition to Viacom18 for the crucial IPL (Indian Premier League) media rights auction.”
A second person said the talks are on track and, as part of the deal, Shankar and his team will have a significant operational role in the company, including inputs into the hiring of a CEO and key managerial personnel.
Text messages sent to Shankar and Lupa India MD Nitin Kukreja remained unanswered till press time.
Replying to an ET query, a Viacom18 spokesperson said, “As a policy, we do not comment on media speculation and rumours. Our company evaluates various opportunities on an ongoing basis.”
“There is no bigger name in the Indian M&E industry than Uday Shankar. He has built Star India and is known for taking big, bold bets. Viacom18 needs such a strong driver to compete in a market that will otherwise see a duopoly between Star & Disney India and Sony-ZEE once they merge,” said a top executive at a consulting firm. “The timing of his entry makes sense as all the major sporting rights are coming up for auction and Viacom18 has just started building its sports business.”
ET first reported that Viacom18 had hired former Star Sports head of sales Anil Jayaraj as CEO of its sports business.
The company has already picked up the media rights of a clutch of sporting properties, including the NBA (National Basketball Association), FIFA World Cup 2022, Italy’s popular football league Serie A, Spanish football league La Liga, French football league Ligue 1, ATP Masters (tennis) and Abu Dhabi T10 (cricket). Incidentally, Shankar and Kukreja had built the sports business of Star India (now Star & Disney India) and were involved in Star India’s Rs 16,347.5 crore bid for the IPL rights in 2017, a 4X jump over the previous rights cycle.
