Wednesday, February 19, 2020
The merger of the media and distribution arms of Reliance Industries viz. TV18, Hathway and DEN under the Network18 umbrella is a positive for shareholders of all four entities.
Despite a common ownership, it was difficult to value the separately listed entities. With consolidation of cable distributors DEN Networks and Hathway Cable and Datacom, broadcaster TV18 under the holding company Network18 Media and Investments, the ‘sum of parts’ valuation is expected to be higher. The merged entity will rank among the top three Indian media companies.This move will improve decision-making and avoid overlaps across business functions. This will also help to generate synergies and improve operating efficiency of the combined entity.
In addition to fine-tuning content deals within the group, the merger could lead to rationalisation of the 27,000 local cable operators with a base of 15 million households and 1 million broadband subscribers.
