Disney to complete UTV buyout

Disney to complete UTV buyout

By Patrick Frater

Wed, 01 February 2012, 20:29 PM (HKT)

Corporate News

The Walt Disney Company is to complete its takeover of Indian film and TV group UTV Software Communications Ltd.

The acquisition, through a subsidiary company, will mean a delisting of UTV's shares and allow Disney to integrate its operations. As was previously announced UTV's CEO Ronnie SCREWVALA (pictured, right) becomes managing director of The Walt Disney Company India Pvt Ltd reporting to Andy Bird (pictured, left), chairman, Walt Disney International.

"As a result of this acquisition and building on UTV's success in the market, Disney will be India's leading film studio and will produce both UTV and Disney-branded local films," Disney said in a statement.

"With the middle class expected to grow from 50 million to more than 500 million people by 2025, this market offers huge potential for us to deliver quality branded entertainment to consumers," said Screwvala.

In July last year UTV told the Bombay Stock Exchange that Disney expected to make an offer of INR1,000 ($22.70) per share that would cost it some $450 million and value UTV at $909 million.

Disney has been an investor in the company since 2005 and became the company's majority owner with a 50.4% of the group in late 2008. (As part of a stake building exercise that was only intended to lift its holding from 14% to 32%, Disney was forced to make an open offer for all the shares at a time when share markets were collapsing and ended up owning a majority stake.)

However, under an agreement between the shareholders, Disney at that time agreed to appoint only three members of the twelve person board and not to exercise management control for a four year period expiring in November 2012.

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