IndiaRetailBiz

Reliance Retail, the retailing arm of Mukesh Ambani controlled Reliance Industries Limited, which for about a year has been in talks with Yash Chopra of Yash Raj Films Limited, to form a Rs. 200 crore ($50 million) joint venture, has now initiated discussions with Manmohan Shetty, the founder of Adlabs Films Limited (currently owned by Mukesh Ambani’s younger sibling Anil Ambani), to form a retail entertainment joint venture.

This joint venture, according to reports, will set up an integrated entertainment retail business by pooling resources and expertise of all the three partners together. While, Yash Raj Films will bring its film and TV content creation prowess on the table, Manmohan Shetty will chip in with installation of 500-odd cinema screens. These screens will be set up in the retail malls being operated by Mukesh Ambani.

While, Yashraj Films, which for some time has been at loggerheads with multiplex owners over revenue sharing formula for the films produced by his production house, including the recently released Karina Kapoor starrer ‘Tashan,’ Shetty has detached himself from Adlabs, which has been bought over by Anil Ambani. Adlabs has been known for its expertise in film processing and film exhibition.They are believed to be joining hands to create a joint venture that will produce movies, gaming, interviews, and other digital content. To deliver this content while Mukesh Ambani’s retail Malls could come handy, he is also expected to contribute his strength in setting up communication infrastructure to deliver different facets of this creative content into customer homes. Reliance Industries, the flagship of Reliance group, is believed to be talking to energy distribution companies like GAIL, Power Grid, and Petronet for leasing a part of optic fiber backbone set up by them to carry digital content across the country.

While, contours of the alliance are still under wraps, as potential partners in the JV have either denied or refused to comment on the subject, the new business if it fructifies will compete directly with Anil Ambani’s multi-media, mega-entertainment, business, being unveiled under BIG Entertainment brand.

In fact, all erstwhile Adlab facilities including theaters, originally promoted by Manmohan Shetty under Adlabs brand (now acquired by Anil Ambani), as well as other multimedia activities like music, radio, internet, and DTH are being brought under the BIG Entertainment banner.

Although Ambani brothers, while splitting their industrial empire in 2005 have signed a five years no-compete agreement, there should be no conflict of interest as far as this business is concerned, since, entertainment business was, perhaps, not a part of Reliance portfolio at the time of split.

Source: Economic Times 1 and 2