New Delhi: Media and entertainment firm UTV Software Communications Ltd has approached competition watchdog CCI to seek approval for its proposed merger with Walt Disney Co (South East Asia) Pvt Ltd in a deal valued at around Rs 2,000 crore.

The company, which last month announced that Walt Disney would buy out the stake held by public shareholders and other promoters of UTV Software Communications, would require the Competition Commission of India's (CCI's) clearance to establish that the stake sale will have any ramifications on market competition.

"They approached the commission on August 1. On the face of it, there seems to be no competition concerns, but more information has been sought from UTV regarding the deal," a source said.

Subsequent to the buy-out of public shareholders by Walt Disney Company, UTV Software Communications Ltd, a promoter group firm, will be delisted from both the Bombay Stock Exchange and National Stock Exchange.

Currently, Walt Disney is the majority shareholder in UTV Software Communications, with 20,497,994 equity shares, accounting for a 50.44 percent stake.

The company's board of directors has approved the delisting proposal and the acquisition of shares from the public at a price not exceeding Rs 1,000 per equity share.

Post-delisting, Walt Disney would also acquire 80,53,480 equity shares representing 19.82 percent of the current paid-up equity share capital of UTV Software Communications from the other promoters of the company at the same price as discovered pursuant to the delisting offer.

At Rs 1,000 per share, the deal could be valued at around Rs 2,000 crore. The company's other promoters include Rohinton Screwvala, Unilazer Exports and Management Consultants Ltd, Unilazer (Hong Kong) Ltd and Zarina Mehta.

From June 1, the mandate of the CCI was expanded to include vetting high voltage merger and acquisition deals.

Under the Competition Act, 2002, companies with a turnover of more than Rs 1,500 crore will have to approach the CCI for approval before merging with another firm. Also, companies with combined assets of Rs 1,000 crore or more, or a combined turnover of Rs 3,000 crore or more, would require the CCI's nod.

The maximum time limit for the CCI to vet mergers has been reduced to 180 days from the earlier 210 days, but the commission may also give its nod faster, depending on the merit of the case, sources said.

(Agencies)