New Delhi: Reliance Industries will consolidate its media and distribution properties under a single entity, putting Network 18 at the vanguard of the conglomerate's progress in the media and entertainment business.
The decision was taken after the boards of TV18 Broadcast, Hathway Cable & Datacom, Den Networks and Network18 Media & Investments met to approve the consolidation.
Doing this means Network 18, one of India’s largest listed media companies, will become an entity with about Rs 8,000 crore in annual revenue and benefit from substantial economies of scale, said the country's largest private sector company by market value.
"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 on Monday.
For every 100 shares owned by them, shareholders of TV18 Broadcast will receive 92 shares of Network 18. Hathway shareholders will get 78 shares of Network18 and Den shareholders 191.
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% 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."
The broadcasting business will be housed in Network18 and the cable and internet broadband businesses will be wholly-owned subsidiaries of Network18. Network 18 will be net-debt free at the consolidated level.
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.
The Reliance Group's holding in Network18 will reduce from 75% to 64% once the merger is completed.
Disclaimer: News18.com is part of Network18 Media & Investment Limited owned by Reliance Industries Limited.
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