Mukesh Ambani’s Reliance Revamps Its TV Business

Reliance Industries Ltd is merging its media and distribution businesses, which is spread across multiple entities into one unified Network18 Media & Investments Ltd in order to help in simplifying the structure of the assets.

In a statement released by Reliance Industries owned and controlled by Indian billionaire Mukesh Ambani, declared that the broadcasting business, TV18 Broadcast Ltd, will now be housed in Network18, whereas the cable and internet services will be folded under two separate units of Network18.

As a result of the recast Reliance Industries holding in the Network18 will now be cut to about 64 per cent from 75 per cent.

According to the statement, the recast will “simplify the corporate structure of the group by reducing the number of listed entities. An integrated media play shall further increase the breadth as well as the depth of the group’s consumer touch points, and allow for retaining a larger share of the consumer’s spend on content.”

According to critics, the recast may be the first step by Asia’s richest man towards bringing on board the strategic investors in a business that is being reshaped by many streaming giants worldwide. In November in an article, Bloomberg News reported that Sony Corp. is conducting due diligence of Network18 as part of the talks to acquire a stake, though the discussions are on the preliminary stage.

Investors such as Sony can bring in some powerful international content and could bolster in the offerings of Network18 in a market where competition is gearing up for the paying viewers. Streaming giants such as Amazon.com Inc and Netflix Inc. have been trying to make inroads into India, where there are more than half a billion smartphone users who are consuming content using the data bandwidth which is made cheaper by Mukesh Ambani’s wireless carrier, Reliance Jio Infocomm Ltd.

TV18 and Network18’s listed subsidiary now owns and operates a bouquet of 56 channels in India and also caters to the Indians overseas through a group of 16 international channels.

In recent past Mukesh Ambani has unveiled many plans to make Reliance Industries free from its net debt by early 2021 and may be as part of that goal, he is been trying to raise more money from the sale of stakes. Last year, Mukesh Ambani also indicated that Saudi Arabian Oil Co. is in talks with Reliance industries to buy a stake in Reliance’s oil and petrochemicals business.

No doubt, the restructuring will certainly help in making Network18 net-debt free at a very consolidated level, with revenue of about 80 billion rupees, which can thus provide a solid base for its growth, according to the statement by Reliance Industries.

According to the Bloomberg Billionaires Index, 62-year-old Mukesh Ambani has a net worth of $57.4 billion.