Reliance Industries Limited (RIL) has reportedly invested Rs. 413 crores in Balaji Telefilms to buy a 25% stake in the Ekta Kapoor owned production company. The deal is structured such that 2.5 crores preferential shares of Balaji Telefilms will be issued to Reliance for Rs. 164 per share, subject to the approval from Balaji Telefilm’s shareholders and others.
Mukesh Ambani led Reliance Industries on Thursday announced that its board had approved the investment in Balaji Telefilms in a Bombay Stock Exchange (BSE) filing. Balaji Telefilms will use the proceeds from this transaction to compete with other over the top (OTT) content service providers and further speed up their content development initiatives, especially for their digital content platform, ALTBalaji.
RIL, in a press release, said this investment in content production, including digital content, is in line with their commitment to invest and grow in telecom, digital and media businesses. Reliance, with this stock purchase, will have access to use content generated by Balaji Telefilms for their telecom arm, Reliance Jio Infocomm Ltd.
Balaji Telefilms in April launched their ad free, subscription based online streaming service ALTBalaji, which has already garnered over 4 million downloads across 80 countries. Last month, they integrated with Reliance Payment Solution’s mobile wallet Jio Money to provide a smooth digital transaction experience to their subscribers.
Balaji Telefilms Chairman Jeetendra Kapoor said the investment was a vote of confidence to the company’s strategic move and welcomed RIL as a partner in their journey. Axis Capital acted as the sole investment banker for this transaction.
Reliance Industries acquired Network18 Media and Investments Ltd., in 2014 and ventured into the television and content business. This investment adds to their presence in the digital content ecosystem. Reliance Jio, which offers video on demand, Live TV and music stream services to their customers, has recently tied up with Hotstar as well. As ALTBalaji continues to increase their consumers base, the possibilities of this acquisition seem to be very promising.