Dharmesh Mehta, managing director of Axis Capital, which acted as the sole investment banker for the transaction, said that the deal was a win-win for both players since it gave RIL access to content and Balaji to subscribers.
In April, Balaji launched its video-on-demand service ALTBalaji. The company had pumped close to Rs 40-50 crore in the venture and had earmarked Rs 150 crore investment over three years. It was in talks with multiple players to raise funds.
"The video-on-demand business requires money and this investment, which will happen at the company-level through a preferential allotment, will allow Balaji to quickly plough the funds received into this business," Mehta said.
The transaction, he said, would not tie Balaji down to one telecom partner and RIL would not be restricted to one content partner through the deal. This is important since Jio, RIL's 4G entrant, has a digital content ecosystem that offers video-on-demand, Live TV and music streaming services to its subscribers.
Before the Balaji deal, Jio had partnered with Star India to offer free premium membership to the latter's service Hotstar via JioTV.
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