THE INDIAN government today said it had approved a bid by US studio giant Disney to fully buy out one of the country’s leading media and entertainment companies.
The Cabinet Committee on Economic Affairs gave the go-ahead for Disney’s Indian unit to increase its shareholding in UTV Software Communications to 100 per cent from a current 50.4 per cent.
Disney India would increase its stake by buying out the promoters and public shareholders stakes in the company in a deal valued at around $390m (£248.08m).
UTV, which has interests from film and television to gaming and animation, has already acquired public shareholders approval to delist the company’s shares from Indian stock exchanges, after buying out the respective stakes.
Chief executive Ronnie Screwvala and three other promoters holds a 19.82 per cent stake in the company. The balance is with public shareholders.
“This approval is expected to result in FDI (foreign direct investment) inflows amounting to Rs82.5bn ($1.6bn/£1.01bn),” the government said in a statement.
A UTV spokesman told reporters that the process was likely to be completed by early next year.
Disney has been working to get a foothold for a number of years in India, which is one of the world’s fastest-growing media and entertainment markets.
It first began operations here in 2004 as Hollywood began looking to emerging markets such as India, China and Russia to boost growth.
It has also moved into India’s expanding cable and satellite television market through its children’s outlets such as the Disney Channel and Hungama TV.
