Tata Play, Airtel Digital TV merger in works as DTH battles streaming disruption: Report

The Tata Play, Airtel Digital TV merger is likely to take place via a share swap, the ET report says.

Tata Play and Airtel Digital TV are heading towards a merger, an Economic Times report said on Tuesday. The merger is likely to take place via a merger swap, the report added. The merger talks come amid the growing dominance of livestreaming and a shrinking customer base in the direct-to-home sector. As per the ET report, Airtel will hold more than 50 percent of the merged entity. This merger, when finalised, will help Airtel grow its revenue in the non-mobile segment.

Tata Sky, India’s largest DTH provider, which has been rechristened as Tata Play, started out as a joint venture with News Corp. In 2019, Walt Disney took over the stakes after acquiring Rupert Murdoch’s 21st Century Fox. The ET report states that the merger will help Airtel gain access to nearly 20 million homes with Tata Play connections. The merger will lead to service providers clubbing broadband, telecom, and DTH into a single subscription. The Tata-Airtel merger is the second high-stakes deal after the 2016 merger of Videocon d2h and Dish TV.

The ET report added that the merged company is likely to be run by the senior management of Airtel. Tata, on the other hand, will hold two board seats under the non-binding agreement. The operations are being valued at around Rs 7,000 crore, the report added. Disney will continue to own shares in the combined entity, the ET report further stated.