MUMBAI (Reuters) – Indian satellite TV operator Dish TV India Ltd said on Friday it planned to merge with rival Videocon d2h Ltd to create a new company with net subscribers of 27.6 million, strengthening its lead in India’s fast-growing direct-to-home (DTH) operator market.
Dish, the first DTH provider in India, said the combined entity will be named Dish TV Videocon Ltd with Jawahar Lal Goel as chairman and managing director. It will have a revenue of about 59.16 billion rupees ($879.11 million).
Following the merger, Dish shareholders will own 55.4% of the new company, with the remaining stake going to Videocon shareholders, Dish said in a statement.
India has an estimated 145 million households with cable and satellite television, but Dish is betting this will grow to 200 million in the next three years.
The DTH provider industry, while small, has been growing fast and is becoming increasingly competitive. It now has at least seven operators, including the privately-held Airtel Digital TV, Tata Sky, and Reliance Big TV.
The new entity will issue 857.791 million shares, and Videocon shareholders will have 2.021 shares of the combined firm for each share held in Videocon, Dish added.
It said the current promoters of Dish will continue as promoters of the combined firm after the deal closes, which is expected to happen in the second half of 2017, subject to regulatory approvals.
The combined company will also seek a global depository receipt listing on the Luxembourg exchange, Dish said.
($1 = 67.2955 Indian rupees)
(Reporting by Sankalp Phartiyal; Editing by Subhranshu Sahu and David Evans)