Disney May Be Nearing Deal to Offload Majority Stake in Indian Operations
A new report indicates Disney could be preparing to sell its Indian business to Reliance Industries Ltd., which could allow it to free up critical cash.
The evolution of Disney’s business from a legacy media company to a streaming-first outlet is proceeding with all of the bumps and bruises one might expect. The company is in the midst of weighing the value of all its assets around the globe to see which will remain under Disney’s control, and which will be sold as the company looks to focus specifically on what it sees as its core assets.
- Disney may be nearing a deal to sell its Indian Disney Star operations.
- The company could make as much as $10 billion from such a sale.
- Disney is looking for infusions of cash as it tries to emphasize its streamers and create a new streaming platform for ESPN.
On the Hunt for Billions
A new report from Bloomberg indicates that Disney is closing in on a deal to sell a controlling stake in its entire Disney Star operation in India to Reliance Industries Ltd. for a deal between $7-$10 billion. The deal could be announced as soon as next month.
Final decisions, such as the total valuation of Disney Star and the minority stake Disney will control in the company after the sale have yet to be ironed out. The entire deal could still come to naught, as Disney may decide to hold onto the asset for a bit longer, according to Bloomberg.
Talks along these lines first began to bubble up in September, when it was reported that Disney would consider a sale of its Indian streaming service Disney+ Hotstar. Now, it appears the company is at least entertaining the possibility of divesting majority ownership in the Indian side of its business, including linear channels as well as streaming properties.
Reliance is the parent company of JioCinema, the streaming platform that snagged Indian Premier League cricket streaming rights earlier this year after Disney+ Hotstar chose to give them up. That decision has led to three straight quarters of subscriber losses for Disney+ globally, as the defections were largely driven by Indian customers who were primarily interested in streaming cricket on the service.
Why Now?
Disney’s precarious financial position as it tries to essentially remake its media business from the ground up has dictated out-of-the-box thinking in nearly every facet of the company. That includes creating a direct-to-consumer streaming platform for ESPN and its sibling channels, which Disney reportedly wants to launch by 2025 at the latest.
That’s one of the reasons the company needs the cash from a sale of Disney Star so quickly. Reports surfaced this week that Disney has an opt-out clause in ESPN’s contract with Major League Baseball that allows it to exit that deal after the 2025 season, and it too could be a source of quick cash for the company as it tries to emphasize streaming as the primary mode of distribution for its content.
That pivot also means combining Hulu and Disney+ into a “one-app experience,” which is expected to occur before the end of 2023. All of these moves take time and money to accomplish, which explains why Disney is being so thorough in exploring every potential deal, and listening to offers for even the most stalwart of assets like ABC.
Disney+
Disney+ is a video streaming service with over 13,000 series and films from Disney, Pixar, Marvel, Star Wars, National Geographic, The Muppets, and more. It is available in 61 countries and 21 languages. It is notable for its popular original series like “The Mandalorian,” “Ms. Marvel,” “Loki,” “Obi-Wan Kenobi,” and “Andor.”