Walt Disney International president Andy Bird with Ronnie Screwvala, chairman and CEO of UTV Software, in Mumbai on Tuesday. Picture by Sanjit Kundu

Mumbai, July 25: It?s consolidation time in the Indian broadcasting space. After the news genre, children?s television saw its first acquisition with Walt Disney (Southeast Asia) Pte Limited, a subsidiary of the $32-billion The Walt Disney Company, acquiring Hungama TV from media house UTV. Walt Disney picked up a 100 per cent stake in United Home Entertainment, which owns Hungama TV, for $30.5 million.

Hungama TV, which is in Hindi and has forged ahead on the localised content plank, will complement Walt Disney?s existing bouquet of Toon Disney and Disney Channel.

The US entertainment firm has also acquired a 14.9 per cent stake in parent company UTV Software Communications for $14 million. This translates into 3.4 million shares at a price of Rs 192.50 per share.

Walt Disney?s effective shareholding in UTV Software will, however, be lower at 13.7 per cent since the latter?s equity capital will be diluted following the issue of 19,49,360 warrants convertible into shares to Ronnie Screwvala, chairman and CEO of UTV Software.

?We will take a long-term view of the Indian market to grow our business. This acquisition will help us advance our presence in India. I would forgo short-term revenue opportunities for the long-term goals that we have set for ourselves. This will help Walt Disney be a part of UTV?s different media businesses, which can in turn benefit from our global media and synergy expertise,? said Andy Bird, president of Walt Disney International.

Refusing to admit that UTV is giving up its television space, Screwvala said, ?I don?t want to write an obituary on our broadcasting plans, but we are definitely not looking at the kids space for a long time to come.?

The company does, however, have large investment plans, now that it has a ?war chest? of Rs 200 crore, which Screwvala admitted he could leverage to raise Rs 500 crore.

?We have huge investment plans that will be revealed in the days to come,? he said. This could include mergers and acquisitions, possibly in the animation and new media space. Screwvala didn?t rule out the possibility of launching channels either, but said, ?We have not written that story yet.?

UTV will continue to create software for Hungama TV, at least for existing programmes like Sania and Hero.

However, Nicky Parkinson, senior VP & MD, Walt Disney Television International (Asia Pacific), said, ?We will work with the best production houses.? Parkinson ruled out any cannibalisation of viewership between the three channels. ?It?s dangerous to go into demographics. Both UTV and Disney have content for kids, but kids have different tastes,? she said.

Zarina Mehta, currently chief operating officer of Hungama TV, will work with the Disney team on the organisational and operational integration of the channel into Disney?s portfolio of kids? channels. Disney has acquired Hungama TV with all its 71 staff members.

For Disney, the opportunity is clearly huge. ?The kids market is growing,? said Rajat Jain, managing director, The Walt Disney Company (India). He estimated the kids television space to be close to Rs 130 crore.