“This investment in the UTV Group is The Walt Disney Company’s commitment to international growth. This investment complements our fast-growing Disney-branded businesses and long-held joint venture in ESPN Star Sports,” says Andy Bird, Chairman, Walt Disney International, and a board member of UTV. “UTV has strong local brands and media properties that provide complementary growth platforms to Disney’s existing branded efforts in India,” adds Bird. Points out Screwvala, the founder- promoter and group CEO, UTV: “The partnership is across movies, TV content, interactive and broadcasting, and endorses our leadership position in India and South-East Asia and further help in our global growth strategies.”
Screwvala would have few complaints with the valuation at which Disney picked up the shares—analysts point out that the Disney subsidiary has bought the additional stake at Rs 1,030 per share, some 30 per cent more than the market price prevailing at the time of the deal. Yet, if punters were unhappy—which is why the stock plummeted 4 per cent (closed the day at Rs 828.2) on the day the deal was announced—it was because of the open offer price of Rs 860 to minority shareholders.
“The market was expecting a price of Rs 1,000,” shrugs a senior analyst from an Indian equity research firm. Investors may have not got the price they wanted, but Screwvala sure seems to have hit pay dirt.
— Anusha Subramanian