Universal to buy 30% in Excel Ent, values Farhan Akhtar-led firm at Rs 2,400 crore

Mumbai: Universal Music India on Monday said it will pick up 30 per cent equity stake in film and digital content studio Excel Entertainment, valuing the Ritesh Sidhwani and Farhan Akhtar-founded firm at Rs 2,400 crore.

The deal, announced in presence of Akhtar's lyricist father Javed Akhtar and Maharashtra Chief Minister Devendra Fadnavis, provides the foundation for "a new strategic partnership" between Universal Music India and Excel Entertainment to accelerate the latter's growth and enhance the former's position in the Indian market, it said.

Noting that Excel Entertainment has a strong track record in music, the statement said the Universal Music Group will gain global distribution rights for all future original soundtracks created for projects owned or controlled by Excel Entertainment as part of the deal.

The alliance also includes the launch of a dedicated 'Excel music' label, which will be distributed globally by the Universal Music Group, it said, adding that the Universal Music Publishing Group will also become Excel's exclusive music publishing partner.

The deal announcement comes amid a spike in large stake buys in Bollywood production houses, including industrialist Adar Poonawalla picking up a 50 per cent stake in Karan Johar's Dharma Productions for Rs 1,000 crore and the more recent announcement of a 28 per cent stake buy by Saregama India in Sanjay Leela Bhansali's company for Rs 325 crore.

Universal Music India Chairman and Chief Executive Devraj Sanyal will join Excel's board, and Sidhwani and Akhtar will continue to shape creative direction and content decisions, the statement said.

"The Indian film scene presents a hugely exciting opportunity for music and the music-led entertainment business, and Excel is the perfect partner for us to work with going forward," Sanyal said.

In a joint statement, Sidhwani and Akhtar said the deal will unlock fresh opportunities for artistes and repertoire across music, film, and emerging formats, and both entities aim to take culturally rooted stories to the world.

"With a shared vision for innovation and excellence, we aim to transform Excel into a creative global studio -- one that brings clutter-breaking, original content to audiences across platforms and geographies," Excel Entertainment Chief Executive Vishal Ramchandani said.

"A global leader in music and intellectual property choosing to deepen its engagement in India through a creator led, home grown studio based in Mumbai sends a very powerful signal that India's creative economy has come of age, our talent is global ready and that Mumbai is no longer just participating in the global media ecosystem, it is shaping it," Fadnavis said.

The statement said the investment and strategic partnership is an opportunity for the Universal Music Group to strengthen its presence in "an important and high-potential market for recorded music", noting that India is the world's 15th-largest recorded music market by revenues, has 375 million 'over-the-top' viewers consuming movies, original shows, sports, reality shows and documentaries, and 650 million smartphone users in India, presenting a big opportunity.

"By partnering with an experienced and highly successful film and digital content studio, Universal Music Group will be able to contribute to audio-visual projects and their associated original soundtracks and be a part of creating extraordinary visual content -- beyond movies and shows -- at the earliest possible stage," the statement added.

Excel Entertainment has released more than 40 films, beginning with 2001 blockbuster 'Dil Chahta Hai', and original scripted series shows.