In a bid to create a leading cable and satellite distribution platform in India, satellite television service provider Videocon D2H will merge itself with Dish TV, the company said in tweet. It also said that the 55 per cent of Dish TV shareholders will represent Videocon D2H’s ownership and the aim behind this merger is to increase the number of subscribers and surge in market shares. Following the closing of the proposed transaction, the merged entity will be renamed as Dish TV Videocon Limited. The merged entity will be led by Jawahar Lal Goel as chairman and managing director.
Vd2h principals shall have right to nominate 2 directors on Dish TV Videocon board, one of whom shall be vice chairman and the other deputy MD. Dish TV Videocon to issue 857.791 million shares as consideration and Vd2h shareholders will be allotted 2.021 new shares of Dish TV Videocon for every one share held in Vd2h. In a release the companies said Dish TV Videocon shall continue to be listed on NSE, BSE in India and on the Luxembourg stock exchange in the form of GDRs. “The deal is expected to be completed by the second half of next year. Combined entity will have market share of 20% making company one of the leading players. Deal will also be value accretive for customers of the combined entity,” company said in a series of tweets.
Companies are also hoping to create dominant position in market with new entity. It has clarified that this combined entity will have senior managers of both Videocon D2H & Dish TV and will have 45 per cent ownership of Videocon D2H. About the brand ambassadors and promoters it said, “Current promoters of Dish TV will continue as promoters of Dish TV Videocon.” Morgan Stanley was acting as exclusive financial advisor to Dish TV, whereas Yes Securities (India) was acting as lead financial advisor to Vd2h.