Sony and Zee to bid for Indian Premier League rights as part of merger

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Sony and Zee Leisure are making ready to enter the bidding for Indian Premier League cricket rights this month as a part of a merger between the Japanese and Indian corporations, based on individuals conversant in the matter.

A Sony-Zee bid for the 2023-2027 media rights for one of many world’s most useful sports activities competitions would arrange a battle with current holder Walt Disney, which owns rival Indian media firm Star India.

Different potential bidders embrace Fb, which bid for the rights in 2017, Amazon and Mukesh Ambani’s Reliance Jio. The Board of Management for Cricket in India, the IPL’s governing physique, mentioned this week that it plans to launch the tender in late October.

“Positively sports activities is one space which shall be regarded upon keenly. It won’t solely widen our target market, but in addition enrich our content material choices on digital platforms,” Vikas Somani, head of mergers and acquisitions at Zee, advised the Monetary Instances.

“With the money infusion as proposed within the transaction phrases, it offers us the firepower to go and bid competitively for these premium sports activities properties.”

The proposed merger was introduced final week as India’s largest listed leisure group faces a shareholder revolt led by Invesco, the US fund that desires to overtake the board and power out chief govt Punit Goenka.

The deal has not but been finalised however would create the most important media group in India, with every thing from tv channels and studios to streaming. The 2 teams would management 27 per cent of India’s media market, based on brokerage Edelweiss.

Sony would take a 53 per cent stake within the mixed entity and make investments practically $1.6bn, which Goenka and different executives say might be used to accumulate content material together with sports activities.

“It’s an vital deal at a really crucial time when the India market is migrating from TV to digital. Sports activities are an enormous, enormous a part of that,” mentioned one particular person conversant in the deal. “In the long term, [it’s] very potential that what we’re placing collectively within the India market turns into the core of a Netflix-style streaming service.”

India is a fast-growing leisure market and the IPL is certainly one of its most useful belongings. The 2-month, short-format cricket event takes place yearly, attracting the world’s largest stars. World and Indian corporations line as much as sponsor or promote throughout matches.

The IPL rights, which sold for $2.6bn in 2017, are anticipated to go for at the very least 25 per cent extra this time, based on Santosh N, a managing accomplice at monetary consultancy Duff & Phelps.

Sony has a sizeable sports activities presence in India, broadcasting every thing from worldwide cricket matches to the Champions League soccer competitors. The corporate acquired Ten Sports activities Community from Zee in 2016 and beforehand held the IPL rights earlier than shedding out to Star in 2017.

Santosh mentioned the take care of Zee would create a extra aggressive purchaser. “With [Sony and Zee] becoming a member of fingers, they’ve an excellent bouquet of basic leisure and sports activities channels . . . making it a really compelling bidder,” he mentioned.

Satoshi Sakae, an analyst at Daiwa Securities, mentioned the merger would enable Zee “to beef up its at the moment skinny sports activities content material”.

However the Sony-Zee deal might not proceed as it’s at the moment structured. Invesco, Zee’s largest shareholder with an almost 18 per cent stake, this week took the corporate to court docket to power a rare basic assembly in its effort to take away Goenka.

Some buyers have been annoyed with what they take into account Zee’s underperformance and poor company governance below Goenka, whose father launched the corporate in 1991.

A lawyer for the shareholders mentioned in court docket that they weren’t towards the proposed merger however felt that it ought to be thought of by a “correct board”.

Sony declined to remark and referred to an announcement on September 22 asserting the proposed merger with the Indian firm.

Extra reporting by Amy Kazmin in New Delhi

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