James Murdoch in talks for stake in India’s Viacom18

James Murdoch and former Disney executive Uday Shankar are in late-stage talks to acquire a stake in Viacom18, a media and entertainment business that is joint-owned by Mukesh Ambani’s Reliance Industries and ViacomCBS.

Valuing Viacom18 at about $4bn, the deal to acquire almost 40 per cent would bring $1.6bn of fresh investment to the broadcaster. This would come from the new shareholders as well as Reliance Industries, which owns 51 per cent of Viacom18 through its company Network18.

A potential deal, first reported by India’s Economic Times, was confirmed by two people close to the transaction. Viacom18 did not immediately respond to request for comment and ViacomCBS declined to comment.

The move comes during an era of consolidation for India’s entertainment and sports broadcasters, with a recent merger of Zee Entertainment and Sony creating one of India’s biggest media conglomerates, just as streaming shakes up the way India watches everything from Bollywood movies to cricket matches.

If a deal goes ahead, fresh funding and new investors “adds significant chops to Viacom18 across key segments in India’s $10bn video landscape”, said Mihir Shah, vice-president at consultancy Media Partners Asia. “The Zee-Sony merger and now this transaction will recalibrate and rejuvenate the video landscape and make the transition to streaming even more competitive.”

The tie-up is expected to build on Reliance’s Jio mobile network, which has more than 400m subscribers in India, to create opportunities to primarily develop streaming first services, according to a person familiar with the deal.

It would strengthen the entertainment and media business of oil-to-telecoms conglomerate Reliance, India’s largest company by turnover. Led by Ambani, Asia’s richest man and chair of the group, Reliance transformed India’s mobile telecoms industry using cut-price data to undercut rivals and ultimately capture the biggest market share.

In Network18, Reliance has a stable of TV channels, news outlets, cinemas and entertainment studios. Meanwhile, Viacom18 has bought rights for American basketball league the NBA, as it ramps up offerings for a sports channel that can compete with Sony-Zee, which plans to bid for Indian Premier League cricket rights.

Son of media tycoon Rupert Murdoch, James Murdoch broke away from the family business after the Murdoch empire was split with the sale of the bulk of 21st Century Fox to Disney. He then set up investment firm Lupa Systems, which has backed a handful of companies, including Vice Media

Lupa’s Indian entity, which has invested in several education start-ups, is backed by Shankar, former Disney Asia-Pacific president. Lupa Systems declined to comment. Shankar could not be reached for comment.

Additional reporting by Anna Nicolaou in New York


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