WSJ: Disney Explores Strategic Alternatives for Indian Operations
Disney Explores Strategic Options for Star India Business, Considering Joint Venture or Sale
chandni
According to insider sources, Walt Disney (DIS.N) is actively exploring strategic alternatives for its Star India business, which may involve forming a joint venture or initiating a sale. The Wall Street Journal reported on Tuesday that Disney has been in discussions with at least one bank to explore avenues for expanding its presence in India while sharing the associated costs.
While these talks are still in the early stages, Disney's specific course of action remains uncertain. The conglomerate's India operations encompass the Disney+ Hotstar streaming service and Star India, acquired as part of the 2019 purchase of 21st Century Fox's entertainment assets.
The WSJ report indicates that Star India's overall revenue for the fiscal year ending in September 2023 is projected to decline by approximately 20%, settling just below $2 billion. Similarly, its earnings before interest, taxes, depreciation, and amortization are expected to drop by roughly 50% compared to the previous year's figure of around $200 million.
Furthermore, the report suggests that Hotstar is anticipated to experience a loss of 8 million to 10 million subscribers in the third fiscal quarter.
Disney Star, the rebranded entity comprising Star India, encompasses numerous television channels and a stake in a film production company.
Like its counterparts in the broadcasting industry, Disney is facing challenges arising from macroeconomic factors, impacting advertising revenue and subscriber growth. In an effort to reduce costs, the company previously announced plans in February to eliminate 7,000 jobs as part of a comprehensive restructuring strategy to save $5.5 billion.
At the time of reporting, Disney had not provided an immediate response to Reuters' request for comment.
