Comcast, the conglomerate behind NBCUniversal and the Sky European TV giant, is to invest $200 million in Bodhi Tree Systems, a company headed by James Murdoch and Uday Shankar, a former head of Disney in India.
The move was approved by the Competition Commission of India on Wednesday. The funds will be directed to buying a small minority stake in Indian media group Viacom18.
The move is part of a complicated series of transactions that bind Viacom18 ever closer to Reliance Industries, the petroleum to telecoms conglomerate controlled by Mukesh Ambani which is now upending Indian media with its Jio cellular, broadband internet and streaming companies.
Bodhi Tree, which was also behind Viacom18’s nearly $3 billion bid for digital rights to the Indian Premier League cricket tournament, has a commitment to invest a total of $1.69 billion into Viacom18, with $538 million as an initial tranche.
Bodhi Tree’s current transaction is reported to be backed by payments of $250 million by the Qatar investment Authority, Bodhi Tree and Comcast. It is understood that Bodhi Tree will go out to investors to raise the remaining portion of the $1.69 billion funding.
In a statement, Viacom18 said that the dealmaking will mean that its equity is 50.994% owned by TV18, 48.994% owned by Paramount Global and that Bodhi Tree has a 0.11% stake. Additionally, Reliance Industries will own 82% of Viacom18’s convertible preference shares and Bodhi Tree the remaining 17.8%.
When all those stakes are converted, the fully diluted ownership looks somewhat different: Reliance Industries would own 60.4%, TV18 13.5%, Bodhi Tree (and its backers) 13.1% and Paramount Global 13%.
Viacom 18 explains that it gets $1.89 billion of cash for its planned growth. This it intends to uses “to innovate and disrupt the media and entertainment sector, with Shankar and Murdoch providing strategic and operational guidance [and] leveraging their track record of building iconic media businesses.”
The massively high profile IPL cricket series is now playing free of charge on JioCinema in direct competition with Disney’s paid-for Star Television.
James Murdoch was previously the Asia-based chairman and CEO of Star Television, prior to its sale to Disney. He was also chairman and CEO of Sky, prior to its sale to Comcast.
