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Reliance Industries consolidates media, distribution businesses into Network18

Under the restructuring exercise, the broadcasting business will be housed in Network18 and the cable and ISP businesses in two separate wholly-owned subsidiaries of Network18

twitter-logo BusinessToday.In        Last Updated: February 17, 2020  | 23:32 IST
Reliance Industries consolidates media, distribution businesses into Network18

Reliance Industries has announced consolidation of its media and distribution businesses into a single entity, Network18. Under the Scheme of Arrangement, TV18 Broadcast, Hathway Cable & Datacom and Den Networks will be merged into Network18 Media & Investments.

The board of directors of the respective companies approved the Scheme of Amalgamation and Arrangement at their meetings held on Monday. The restructuring will create value-chain integration and render substantial economies of scale. It will also simplify the corporate structure of the group by reducing the number of listed entities.

"The broadcasting business will be housed in Network18 and the cable and ISP businesses in two separate wholly-owned subsidiaries of Network18," Network18 Media & Investments said in a regulatory filing.

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"The appointed date for the merger shall be February 1, 2020," it further added.

The Scheme of Arrangement chalked out the share exchange ratio for shareholders of the associated companies. For every 100 shares they own, shareholders of TV18 Broadcast will receive 92 shares of Network18, Hathway Cable & Datacom shareholders will get 78 shares of Network18 and Den Networks shareholders will get 191 shares of Network 18.

"Shareholders of all the four Companies will benefit from streamlining of operations and strategy, focused management, and reduction of risk through consolidation," the company said.

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Network18, the umbrella entity for all media and distribution businesses under Reliance Industries, will have revenue of around Rs 8,000 crore. It will be net-debt free at consolidated level, providing a solid base for growth as well as improved shareholder returns, the statement said.

The consolidation of cable businesses of Den and Hathway in one entity will leverage the combined strength of around 27,000 LCO partners who act as the touchpoints to around 15 million households across India. Meanwhile, the combined broadband entity will serve approximately 1 million wireline broadband subscribers across the country.

"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... The reorganisation furthers the group strategy of building a media powerhouse that is agnostic across pipes, platforms and screens," it said.

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