Industry sources are reporting that Reliance Digital TV and Sun Direct would announce the merge of their DTH operations in the Indian market.
The two companies are likely to announce this merge in the coming days. Sun Direct would take over the management of the company. Reliance would exit the company at a later stage when Sun would launch an IPO of the merged company.
Reliance Communications is going for this deal to focus on their core services which is mobile calling and internet. The merger would allow them to exit from the competitive digital television market. DTH companies face intense competition from CAS operators after the government made it mandatory for cable operators to switch from analogue transmission to digital.
The combined entity would become the second largest DTH Company in the Indian market after Zee Dish TV. It would overtake Tata Sky DTH which is currently the second largest player.