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India’s Eros Group, a key player in film production and distribution, is in early talks to sell its content library to Apple, Netflix or Amazon for “around $1 billion,” according to a report Monday in business newspaper The Economic Times, which cited unnamed sources.
A potential deal may also include the company’s streaming service ErosNow, the report suggested.
Another report by Reuters also quoted an unnamed source as saying that Eros was in talks with Apple, Amazon, Netflix “and other major content distributors to sell its entire content library of films and music.” It added that talks were in “very early stages.”
Asked for comment by The Hollywood Reporter, Mumbai-based Eros shared a statement that it also issued to the Bombay Stock Exchange. “It may be noted that we are not privy to any strategic discussion that our NYSE listed parent company Eros International plc may be having with various potential partners,” it said. “As always, the company will continue to make the necessary disclosures as and when material events occur.”
An Amazon India representative told THR: “We don’t comment on rumors or speculation.”
Eros’ Indian listed entity — which primarily focuses on content creation — is a subsidiary of Eros International, which handles international distribution and also runs ErosNow, which has said it has 2.9 million paid subscribers. Eros was originally founded in 1977 in Mumbai and over the years also developed the overseas diaspora market for Indian films. In 2006, the company’s U.K.-based holding company Eros International became the first Indian entertainment firm to list on the London Stock Exchange’s Alternative Investment Market. However, in 2013 it delisted from AIM and moved its stock listing to the New York Stock Exchange.
The Times report also suggested that Eros was planning a “mega restructuring exercise” leading to a “reverse merger” of its international parent with the Indian subsidiary by the end of the current financial year. Eros has been battling allegations of financial irregularities since 2015, a charge that the company has repeatedly denied.
For the fiscal year ending in March, Eros International reported revenue of $253 million, a drop of 7.8 percent from $274.4 million in 2016. Net income decreased by 13.5 percent to $11.5 million.
Eros’ catalog library of about 3,000 titles covers mainstream Hindi-language Bollywood and regional language cinema, considered the largest of any Indian film group. Eros’ hits include last year’s historical epic Bajirao Mastani, while its upcoming slate of 50 titles includes co-productions with China with the working titles The Zookeeper and Love in Beijing.
For its part, ErosNow holds digital rights to over 10,000 films, with over half of them in perpetuity.
The Indian OTT space has been heating up with the launch of Netflix and Amazon last year, which are battling strong local competitors in Fox’s Star India service Hotstar, Viacom18’s Voot and Sony Networks’ SonyLIV, among others.
Amazon and Netflix have been bolstering their local content offerings, with the former adopting a more aggressive approach by signing content deals with leading Indian banners such as Dharma Productions and more recently, Bollywood star Salman Khan’s banner. Netflix has also pacted with top star Shah Rukh Khan’s banner. In terms of original content, Amazon recently unfurled its first Indian original, cricket drama Inside Edge, while Netflix is in production on its upcoming drama series Sacred Games headlined by Bollywood star Saif Ali Khan, while announcing two more originals.
ErosNow has also rolled out its first original, adventure series Salute Siachen.
Apple launched iTunes in India in 2012, followed by Apple Music in 2015, with both services offering content from leading Indian labels such as Sony Music, Zee Music and Universal Music, among others.
If there is indeed any content deal with Eros, that would come in handy for Apple to “significantly catch up” in the Indian market, Deloitte India partner Jehil Thakkar tells THR. He also adds that for Eros, a potential deal with Apple would give it the support of a strong player given that ErosNow rivals are backed by entertainment giants, notably Fox/Star India, Sony and Viacom.
At an industry conference in New York in December, Eros International CFO and president of North America Prem Parameswaran said that in the Indian market, Netflix was “a friend,” while Amazon was a “tough competitor” for the company.
Adding that Netflix was mostly more Western in its content offerings, Parameswaran highlighted that Indians like local content, mentioning that only 10 percent of the box office in the country “is Western” as “Indians really want Bollywood content.”
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