By Gary Symons
TLL Editor in Chief
The Walt Disney Company is close to a deal to sell its operations in India to its biggest rival Reliance Industries.
Disney values its India assets, which includes the Disney+ Hotstar streaming service, at around $10 billion. The company has been looking at ways to trim costs after dealing with the fallout from the COVID-19 pandemic, and a general drop in cinema revenues.
Bloomberg News has reported that Disney wants to try to sell all of its operations in a single package to Reliance, a media conglomerate that is Disney’s greatest rival in that country. Among other things, Reliance owns a popular Indian streaming service.
This follows earlier reporting by Reuters in July that Disney was exploring options to either sell its assets, or to find a local partner. The company has held exploratory talks with Indian billionaires Gautam Adani, and Sun-TV owner Kalanithi Maran, as well as the private equity firm Blackstone, which is one of the world’s largest investment funds.
But Disney reportedly also would prefer to sell all of its Indian assets in a single package, thus increasing their value, leading to the negotiations with Reliance.
That deal would see Disney selling a controlling stake in the business to Reliance, and therefore partnering with their greatest rival. Reliance is a massive media conglomerate that also owns JioCinema, the most successful streaming platform in India, whose success has weighed against the success of Disney+ Hotstar.
Bloomberg’s sources indicate price may be a factor in whether the deal goes ahead, as Reliance places the value at a lower value than does Disney. Reliance has put the value of Disney+ Hotstar and Star India at between $7 billion and $8 billion, while Disney places the value at $10 billion.
As well, the enterprise value of the assets in India were estimated at more than $15 billion when Disney bought the operations from Fox. As well, the sale would dramatically affect Disney’s global user numbers for its streaming services globally, as India represents Disney’s largest single group of streaming customers.