CCI okays UTV Software-Walt Disney merger

The Competition Commission of India (CCI) today cleared the proposed merger of media and entertainment firm UTV Software Communications with Walt Disney (South East Asia) at about Rs 2,000 crore.

The CCI approved the proposed combination as "it is not likely to have any appreciable adverse effect on competition", said an order.

UTV Software had last month announced that Walt Disney would buy the stake of promoter as well as public in the software company.

As the proposal needed the nod of the CCI, the UTV Software had approached the Commission on August 1.

"Based on the facts on record and the notice of the proposed combination filed by the acquirer [Walt Disney] under sub-section [2] of section 6 of the Competition Act, and the examination of the businesses involved.... The Commission, hereby, approves the proposed combination," the CCI order said.

 

The CCI further observed that while the Disney Group was in the business of character merchandising and publishing through Disney India, the UTV Group was engaged in broadcasting.

Subsequent to the buyout of public shareholding by Walt Disney Company, UTV Software Communications will be delisted from both the Bombay Stock Exchange and National Stock Exchange.

Currently, Walt Disney is the majority shareholder in UTV Software Communications with 20,497,994 equity shares, accounting for a 50.44% stake.

The board of UTV Software has approved the delisting proposal and the acquisition of shares from the public at a price not exceeding Rs 1,000 per equity share.

Post-delisting, Walt Disney would also acquire 80,53,480 equity shares representing 19.82% of the current paid-up equity share capital of UTV Software Communications from the other promoters of the company at the same price as discovered pursuant to the delisting offer.

At Rs 1,000 per share, the deal could be valued at around Rs 2,000 crore. The company's other promoters include Rohinton Screwvala, Unilazer Exports and Management Consultants, Unilazer (Hong Kong) and Zarina Mehta.