Sony Corp. is in talks to acquire a stake in the Indian television network controlled by billionaire Mukesh Ambani, as the Japanese giant seeks to tap booming demand for content in the South Asian nation, according to people familiar with the matter.
The Tokyo-based company is currently conducting due diligence on Ambani’s Network18 Media and Investments Ltd before any possible offer, the people said, asking not to be named as the information is not public.
Sony is considering several potential deal structures, including a bid for the company or a merger of its own Indian business with Network18’s entertainment channels, one of the people said.
Talks are at a preliminary stage and may not result in a transaction, the people said. Shares of Network18 surged as much as 19% in Mumbai on Thursday, while unit TV18 Broadcast Ltd jumped 9.7%.
While a successful deal may help Sony bolster its local offerings and take on upstart rivals such as Netflix Inc., it will give Ambani access to international content. The Indian tycoon’s wireless carrier, Reliance Jio Infocomm Ltd, has spent almost $50 billion in the past few years on its network to disrupt India’s telecommunications industry and has been luring users by offering local and overseas programming.
“Our company evaluates various opportunities on an ongoing basis,” a spokesman for Ambani’s Reliance Industries Ltd, said in an email, declining to comment further. Representatives for Sony in India and Japan didn’t immediately respond to requests for comments.
The talks come at a time when competition is heating up for paying viewers in a potentially lucrative market with more than half a billion smartphone users.
Streaming companies such as Netflix to Amazon.com Inc. Prime are increasingly offering programs created locally to lure subscribers. Ambani’s Jio, while having the technology platform, is limited by the paucity of content it can stream, making such a deal with Sony crucial.―Livemint