Disney has signed a non-binding term sheet with Indian company Reliance Industries that would see the merger of their India operations, including Disney+ Hotstar, Deadline reports.

New Disney+ Hotstar Agreement Finalized

Amid struggles with streaming, it was reported in October that Disney was considering selling their India assets, including Disney+ Hotstar, to Reliance, their main competitor in the market. Under the terms of the agreement, Reliance Industries would own 51 percent of the merged entity, while Disney would own 49 percent. The deal is not yet complete but could be ready by February.

The term sheet was finalized at a London meeting last week with Kevin Mayer representing Disney and Manoj Modi, advisor to chairman Mukesh Ambani, representing Reliance.

Though Disney+ Hotstar has had more users than Disney’s other streaming services, it began losing significant subscribers after Disney lost streaming rights to India Premier League (IPL) cricket matches last year. In the first quarter of 2023, Disney+ Hotstar lost 3.8 million subscribers. In quarter two, it lost 4.6 million.

After Disney acquired Hotstar in their purchase of 21st Century Fox, they combined the service with Disney+. Previously, IPL matches were free to watch, but Disney made them part of the paid service in 2020. Streaming app JioCinema — partially owned by Reliance Jio — then acquired the rights to IPL matches.

“We were bullish on Indian subscribers’ propensity to pay. That’s not worked out,” a Disney source told Reuters earlier this year when they began to stream live matches of the Asia Cup for free. “Free cricket is the only bullet left.”

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