CCI gives nod to the merger of UTV with Walt Disney

Competition watchdog, Competition Commission of India (CCI)has given clearance to the proposed merger of media and entertainment firm UTV Software Communications with Walt Disney (South East Asia) at about Rs 2,000 crore.

Earlier, last week UTV had approached� the CCI seeking approval for its deal with Walt Disney. It was the directive of theCompetition Act 2002 and an obligatory process which was required for facilitating the process of the deal. The Competition Act 2002, implies that companies with a turnover of more than Rs 1,500 crore must approach the CCI for approval before merging with another firm. Also, companies with combined assets of Rs 1,000 crore or more, or a combined turnover of Rs 3,000 crore or more, would require the CCI's nod.

Following to the buy-out of public shareholders by Walt Disney Company, UTV Software Communications Ltd will be delisted from both the Bombay Stock Exchange and National Stock Exchange.

At present, Walt Disney is the majority shareholder in UTV Software Communications, with 20,497,994 equity shares, accounting for a 50.44 per cent stake. After the delisting process, it will also acquire 80,53,480 equity shares representing 19.82 per cent of the current paid-up equity share capital of UTV Software Communications from the other promoters of the company at the same price as discovered pursuant to the delisting offer.

The company's board of directors has approved the delisting proposal and the acquisition of shares from the public at a price not exceeding Rs 1,000 per equity share.

At Rs 1,000 per share, the deal could be valued at around Rs 2,000 crore. The company's other promoters includeRohinton Screwvala, Unilazer Exports and Management Consultants Ltd, Unilazer (Hong Kong) Ltd and Zarina Mehta.