NCLT Grants Approval For Viacom18 And Star India Merger Scheme

The National Company Law Tribunal (NCLT) in Mumbai has taken the first step towards the completion of merger deal involving Reliance Industries Ltd's Viacom18, its subsidiary Digital18, and Walt Disney's Star India. The tribunal's Mumbai bench has admitted the merger scheme. The merger scheme entails a multi-stage process. Firstly, Viacom18's TV and streaming assets will be transferred to Digital18, its wholly-owned subsidiary. Subsequently, these assets will be demerged and vested from Digital18 to Star India. As part of the consideration for this scheme, Viacom18 will transfer its streaming platform, JioCinema, to Digital18. This transfer will be compensated through an allotment of fully paid-up shares, totaling Rs 24,186 crore. Additionally, Viacom18 will transfer its media operations to Digital18 for a consideration of Rs 2,769 crore in the form of fully paid-up shares. The shareholding structure post-merger will see Walt Disney holding 36.63%, Digital18 holding 46.11%, and Reliance Industries Ltd holding 16.34% of Star India. The application for the merger was filed by the companies on March 29, following the announcement of the mega-merger deal. To ensure transparency and compliance with regulatory requirements, the NCLT has directed the companies to convene meetings of their secured and unsecured creditors to seek approval for the merger scheme. Additionally, the companies are mandated to serve notices, along with a copy of the merger scheme, to various government authorities and regulatory bodies, including the Central Government, Registrar of Companies, Income Tax Authority, Goods & Services Tax Authorities, Competition Commission of India, and Ministry of Corporate Affairs. The tribunal has set a deadline of 30 days for these authorities to respond to the notices. Failure to respond within this timeframe will be construed as no objection to the proposed scheme. In accordance with the directives outlined for the meetings of the secured and unsecured creditors of Viacom18 and Star India, several procedural steps have been established to ensure transparency and compliance with legal requirements. Firstly, at least one month prior to the meetings, notices convening the said meetings, along with a copy of the Scheme and Explanatory Statement, will be sent via electronic mail to the registered email addresses of the respective secured and unsecured creditors. In cases where email addresses are not available or where recipients have not received the notices via email, they will be able to access and download the notices from the official websites of Viacom18 and Star India. Additionally, at least 30 days before the meetings, notices will be published in prominent newspapers, including 'Business Standard' in English and 'Loksatta' in Marathi, circulating in Maharashtra. These notices will inform stakeholders about the availability of copies of the Scheme and the required statement, which can be obtained free of charge from the registered offices of the respective applicant companies or by emailing the designated addresses. Furthermore, to oversee the conduct of these meetings, Justice (Retd.) Shri Suresh Chandrakant Gupte of the Bombay High Court has been appointed as the Chairperson. In the event of his unavailability, Ms. Naina Krishna Murthy, Partner at Krishnamurthy & Co. (K Law), Advocates, will assume the role. For the scrutiny of proceedings, Mr. B. Narsimhan, Practising Company Secretary, Proprietor of M/s. BN Associates, has been designated as the Scrutinizer. In the absence of Mr. Narsimhan, Mr. Venkataraman K, Practising Company Secretary and Partner at M/s. BN Associates, will step in to fulfill the duties of the Scrutinizer. Click Here To Read/Download Order

NCLT Grants Approval For Viacom18 And Star India Merger Scheme

Rajesh Kumar

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