Disney Star's deal with Reliance may take a $2 billion hit amid the Zee-Sony fallout. Here's why
aborted Sony-Zee merger, Disney Star finds itself at risk of a significant valuation hit, potentially amounting to an unprecedented $2 billion, The Economic Times reported citing sources. The fallout from Zee Entertainment Enterprises (ZEEL) disputing a $1.5-billion sub-licensing deal for the International Cricket Council (ICC) has triggered concerns about Reliance's downgrade of Disney Star, it said. ZEEL contended that its obligations to honour the ICC deal with Disney Star were contingent on the successful completion of Zee's merger with Sony.
However, Disney Star disputes this claim. Also Read | Zee Ent share price rallies over 7% after more than 30% slump on Tuesday Sources told the paper that Reliance Industries (RIL) is closely monitoring the Sony-Zee merger, given the direct implications for Disney Star's valuations linked to the ICC TV deal. RIL has prepared two valuation scenarios for Disney Star – one considering ICC TV rights obligations and the other without, sources told the paper.
The potential downgrade of up to $2 billion hangs in the balance, contingent on Disney Star servicing the ICC TV deal alongside digital rights. Despite recent uncertainties, Disney Star has confirmed its coverage of the ICC U19 Men's Cricket World Cup 2024 on Star Sports and Disney+ Hotstar. Notably, Disney Star has factored the ICC television rights deal into its tariffs, raising the bouquet price by approximately 10 percent, even after losing the Board of Control for Cricket in India (BCCI) media rights.
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