Reliance’s Viacom18 deal spooks investors

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Editor's note: Last year, Viacom18, a subsidiary of Reliance Industries-controlled TV18, announced a partnership to infuse capital into the firm. It said two entities, namely its parent and Bodhi Tree Systems, would bring in Rs 15,145 crore to help Viacom18 invest in its high-growth businesses—digital, sports and regional entertainment.  Of the proposed investment, Rs 13,500 crore was to come from Bodhi Tree Systems, an investment platform backed by media tycoon James Murdoch and former Disney India executive Uday Shankar; Reliance was to invest the remainder. Additionally, Reliance would transfer its JioCinema business to Viacom18.  An important detail, however, was left out. The announcement did not make it clear how the planned capital infusion would affect the ownership structure of Viacom18, which incidentally makes up the biggest chunk of TV18’s consolidated revenue and profits.  The deal came through last week, six months after the initial deadline. As per the terms, the shareholders of Viacom18 are TV18 (with a 50.994% equity stake), Paramount Global (48.994%) and Bodhi Tree (0.011%). Materially, not much has changed. Viacom18 will get its money and JioCinema stands transferred to …