Scatmag.com

June 2017

CCI APPROVES DISHTV-VIDEOCON D2H MERGER


In Direct Conflict Of The TRAI's Recommendations, The CCI Has Approved The Merger Of DishTV & Videocon d2h To Form The World's largest DTH Company!


Are the TRAI's recommendations being wilfully ignored by the government?

On 17 April, the MIB ignored the TRAI's recommendations & granted a broadcast license to the Tamil Nadu State government owned Aarasu Cable TV Network.

A month later, on 9 May 2017, the Competition Commission of India (earlier MRTP) approved the merger of Dish TV and Videocon d2h. "We have got approval from the CCI for the proposed merger with Videocon d2h," Dish TV CMD Jawahar Goel told the press.


Dish TV Videocon Will Be The World's largest DTH Company



MONOPOLISTIC

For years, the TRAI has maintained its recommendation that mergers in broadcasting should not be permitted if the merged entity has more than 30% market share.

India has 62.65 million active DTH subscribers according to the TRAI. Their approximate market shares are shown in figure 1.

Dish TV is India's largest DTH platform with more than 15.3 million active subscribers.

Videocon d2h has 12.77 million subscribers.

The 2 DTH platforms combined have a subscriber base of more than 28 million subscribers, or more than 44% of all pay DTH subscribers in the country. This is clearly contrary of the TRAI's 30% market cap recommendation.








A P P R O V A L S PENDING

Dish TV still needs approvals from the MIB, the National Company Law Tribunal and the stock exchanges. However, these are seen to be merely procedural.


LARGEST DTH WORLDWIDE

Dish TV Videocon, as the new company will be called, will be the largest DTH company in the world by subscriber count (28.07 million in Dec 2016).

DirecTV USA, the next largest, had 21 million DTH subs in Dec 2016.


DTH PLATFORM URBAN SUB (Top 200 Towns) RURAL SUBS
Dish TV 30% 70%
Videocon d2h, 40% 60%

Table-2: Urban & Rural Subscribers



THE COMPANIES

Dish TV is listed on the NSE and BSE in India and the Luxembourg Stock Exchange as GDRs.

Videocon d2h is a Nasdaq listed company.

The merged entity, Dish TV Videocon, will be led by Jawahar Lal Goel as Chairman and Managing Director. Videocon d2h will nominate the Vice Chairman & Dy Managing Director.

Videocon d2h shareholders own 44.6% & Dish TV 55.4% of Dish TV Videocon. n