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India raises concerns over Disney-Reliance merger
STORY: The proposed merger between Walt Disney’s media companies and India’s Reliance Industries may have been derailed. An initial assessment of the proposed $8.5 billion deal by India’s antitrust regulator has concluded that the deal could hurt competition because both parties hold cricket broadcasting rights, according to four sources who spoke to Reuters on Tuesday. It is the biggest setback yet for the planned merger of Disney and Reliance, which would create India’s biggest entertainment conglomerate. The combined company, which would be majority owned by Asia’s richest man, Mukesh Ambani, would compete with Sony, Zee Entertainment, Netflix and Amazon and offer a total of 120 television channels and two streaming services. It would also hold lucrative multi-billion dollar rights to broadcast cricket on television and streaming platforms. This prompted the Competition Commission of India (CCI) to warn Disney and Reliance in a confidential communication that their influence over India’s most popular sport may be too great, raising fears about their pricing power and the merged entity’s potential influence over advertisers. Cricket has a fanatical following in India, the world’s most populous country with an estimated 1.4 billion people. The CCI has asked both companies to explain within 30 days why it should not order an investigation. Reliance, Disney and the CCI did not respond to requests for comment.
