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Uday Shankar-led Bodhi Tree brings in Rs 4,306 crore for 13.08% stake on diluted basis in Viacom18

After the completion of the transaction for strategic partnership with Reliance, Bodhi Tree Systems and Paramount Global, Viacom18 allots shares to Bodhi Tree Systems and RIL group entities as consideration for the Scheme of merger

Uday Shankar

Leading broadcaster Viacom18 on Thursday said it has completed the transaction for strategic partnership with Reliance, Bodhi Tree Systems and Paramount Global.

Following the approval of the scheme of merger of Reliance Storage Ltd with Viacom18 by the Mumbai bench of the National Company Law Tribunal, the broadcaster has allotted shares to Bodhi Tree Systems and RIL group entities as consideration for the merger, according to a statement.

With the merger, the integration of JioCinema into Viacom18 has been completed, the statement said.

"Now Viacom18 has access to Rs 15,145 crore of cash for its planned growth, comprising Rs 10,839 crore contributed by RIL group entities and Rs 4,306 crore contributed by Bodhi Tree Systems," it added.

Post the merger, TV18 will have 50.994 per cent equity in Viacom18 while the rest would be held by Paramount Global and Bodhi Tree, an investment venture of James Murdoch's Lupa Systems and Uday Shankar, ex-Chairman of Star and Disney India.

Paramount Global, formerly known as ViacomCBS, will have 48.994% equity and Bodhi Tree will have 0.011%

According to the agreed terms, RIL group entities will have 82.2% CCPS, or Compulsorily Convertible Preference Shares, and Bodhi Tree will have 17.8% CCPS.

CCPS shares carry certain terms—if an early investor has CCPS, he can have more rights than other investors who come in later at a higher valuation.

On a fully diluted basis, RIL group entities will have 60.37%; TV18 – 13.54%; Bodhi Tree – 13.08% and Paramount Global – 13.01%.

The transaction and subsequent shareholding patterns indicate a significant change compared with the April 2022 announcement.

On April 27, 2022, Reliance and Viacom18 announced that Bodhi Tree Systems was leading  a fund raise with a consortium of investors to invest Rs 13,500 crore in Viacom18.

With the proposed investment of Rs 13,500 crore, Bodhi Tree was likely to own a 39% stake in Viacom18 leaving a 10% stake for Paramount Global (ViacomCBS).

However, Bodhi Tree has been able to bring in Rs 4,306 crore of investment raised from Qatar Investment Authority (QIA), the sovereign wealth fund of Qatar.

Following this, Bodhi Tree’s shareholding will reduce from 39% to 13.08% on a fully diluted basis.

JioCinema has exclusive rights for digital streaming of the ongoing Tata IPL 2023. Reliance-backed Viacom18 got digital rights from the cricket board BCCI for Rs 20,500 crore for the 2023-27 cycle of the IPL.

"The partnership will enable Viacom 18 to innovate and disrupt the M&E sector, with Uday Shankar and James Murdoch providing strategic and operational guidance to Viacom 18, leveraging their track record of building iconic media businesses," the company statement said.

Uday Shankar has also been appointed to the board of Viacom18.

"Paramount Global will continue as a shareholder and supply Viacom18 its premium global content. This unique partnership brings together India's biggest conglomerate, two of the most recognised media industry veterans and a leading global media and entertainment company," it added.

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