Mumbai: Reliance Industries (RIL) on Monday announced a consolidation of its media and distribution businesses spread across multiple entities into Network18.
Under the scheme of arrangement, TV18 Broadcast, Hathway Cable & Datacom and Den Networks will merge into Network18 Media & Investments, the company said in a statement.
"The appointed date for the merger shall be February 1, 2020. The Board of Directors of the respective companies approved the scheme of amalgamation and arrangement at their meetings held today," the company said in a statement.
The broadcasting business will be housed in Network18 and the cable and ISP businesses in two separate wholly owned subsidiaries of Network18.
The company said that the restructuring would create value-chain integration, and render substantial economies of scale.
The scheme shall also simplify the corporate structure of the group by reducing the number of listed entities, the statement said.
"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," it said.
The media industry is accelerating towards being a B2C (business-to-consumer) play, led both by market factors and through regulation, the statement said, adding that an integrated media play shall further increase the breadth as well as depth of the group's consumer touchpoints, and allow for retaining a larger share of the consumer's spend on content.
According to RIL, the reorganisation furthers the group strategy of building a media powerhouse that is agnostic across pipes, platforms and screens.
"Shareholders of all the four companies will benefit from streamlining of operations and strategy, focused management, and reduction of riskthrough consolidation."
Post the consolidation Network18 will be an integrated media and distribution company with a revenue of Rs 8,000 crore and will scale-up as one of the largest listed players in the sector.
Network18 will be net-debt free at consolidated level, providing a solid base for growth as well as improved shareholder returns, the statement said.
"Reliance's holding in Network18 will reduce from 75 per cent to 64 per cent upon implementation of the scheme," the statement added.
"The 'Scheme of Arrangement' is subject to all necessary approvals."
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