Reliance Industries and Walt Disney have announced the merger of their India TV and streaming media businesses, creating an $8.5 billion entertainment giant that will dominate the market in the world’s second-most populous country.

The deal will see Reliance, led by billionaire Mukesh Ambani, inject $1.4 billion in the merged entity, and hold a 63% stake, while Disney will own the remaining 37%. The merger values Disney’s India assets at around $3 billion, a sharp drop from the $15 billion they were worth when Disney acquired them as part of its Fox deal in 2019.

The merged entity will have 120 TV channels, two streaming platforms, and cricket rights for key tournaments in India, where the sport has a huge fan base. Analysts say the deal will give Reliance an edge over competitors such as Sony, Zee Entertainment, and Netflix, and provide Disney with a cash cushion and a stronger presence in India.

The board of the combined entity will be chaired by Ambani’s wife Nita, and vice-chaired by former Disney executive Uday Shankar. The companies said the merger will serve over 750 million viewers in India and abroad, with a diverse portfolio of digital services and entertainment and sports content.

Disney CEO Bob Iger said the deal will allow the company to better serve Indian consumers, who are a key market and one of the strongest international growth markets of scale. An internal memo by Disney’s entertainment co-chairs and ESPN’s president said the company was committed to ensuring a robust presence in India.

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