Mumbai: The India unit of Universal Music Group (UMG), world's largest music company, has acquired a 30% stake in Farhan Akhtar and Ritesh Sidhwani’s Bollywood production house Excel Entertainment at an enterprise valuation of Rs 2,400 crore, in one of the largest deals in the film entertainment business.

Under the agreement, Akhtar and Sidhwani will retain creative control, while UMG gains a foothold in the video business and strengthens its Bollywood music catalogue. Devraj Sanyal, Chairman and CEO of Universal Music India & South Asia and SVP of Strategy for Africa, Middle East and Asia, will join Excel Entertainment’s board.

The deal marks the third major M&A transaction in the Hindi film industry in recent times, following Adar Poonawalla’s Rs 1,000 crore investment for a 50% stake in Dharma Productions and Saregama’s Rs 325 crore investment in Sanjay Leela Bhansali’s Bhansali Productions.

The transaction highlights a renewed consolidation wave in the media and entertainment sector, as companies chase scale, capital and stronger IP portfolios amid shifting consumer behaviour. UMG becomes the second music label after Saregama to invest in a film production company, expanding its presence beyond music into filmed entertainment.

Ritesh Sidhwani and Farhan Akhtar, Founders of Excel Entertainment said, “India’s entertainment landscape continues to grow from strength to strength, and this is the perfect moment to build meaningful global collaborations. We’re excited to partner with UMG in what we believe will be a truly creative and transformative alliance—one that unlocks fresh opportunities for artists and repertoire across music, film, and emerging formats. Together, we aim to take culturally rooted stories to the world.”

Vishal Ramchandani, CEO, Excel Entertainment said: “This partnership with UMG marks a pivotal step in our journey to broaden creative opportunities and tell Indian stories with a global lens. 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.”

Adam Granite, UMG’s CEO of Africa, Middle East and Asia (AMEA), said: “Today’s announcement further strengthens UMG’s position in India, a dynamic and strategically important music market for the group globally. Original soundtracks remain at the heart of India’s fast-growing music market, with Indian listeners showing a growing desire to access more music in that genre. By investing in and partnering with Excel Entertainment, UMG will be uniquely positioned to contribute from the earliest stage to Excel’s future endeavours and throughout the creative process, providing huge benefits to both parties.”

Devraj Sanyal said: “Farhan and Ritesh have built an exceptionally impressive business, and we’re thrilled to be working with them on the next phase of their journey. 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”.

The investment and strategic partnership, he added, would help UMG deepen its presence in a high-potential recorded music market.

India is the world’s 15th-largest recorded music market by revenues, according to the latest IFPI data, with strong linkages between the country’s audio-visual and music sectors. The opportunity is further underpinned by more than 375 million OTT viewers and an estimated 650 million smartphone users.

Founded in 1999, Excel Entertainment has released more than 40 films and scripted series. Its breakout film Dil Chahta Hai set the tone for a slate that includes Lakshya, Don, Zindagi Na Milegi Dobara, Fukrey, Dil Dhadakne Do and Gully Boy.

The company was also among the earliest studios to embrace streaming, producing Amazon Prime Video’s first Indian original series Inside Edge, followed by titles such as Mirzapur, Made In Heaven, Dahaad and Netflix’s Dabba Cartel.

AZB & Partners acted as legal counsel to Universal Music Group. Ernst & Young and KPMG served as transaction advisors to Excel Entertainment and Universal Music Group, respectively. Morgan Stanley advised Excel Entertainment, while Khaitan & Co acted as its legal counsel.

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Mumbai: The Universal Music Group-Excel Entertainment deal could catalyse fresh foreign merger and acquisition interest in India's media and entertainment industry, with the Maharashtra government promoting Mumbai as a global hub to produce creative content, people familiar with the development said.

At least three similar transactions are currently under discussion, though details remain under wraps due to commercial sensitivities, said a top-ranked Maharashtra government official closely tracking the discussions, requesting anonymity.

Universal Music Group's India unit has agreed to acquire a 30% stake in Farhan Akhtar and Ritesh Sidhwani-promoted Excel Entertainment at an enterprise valuation of Rs. 2,400 crore, marking one of the largest deals in India's film and entertainment space.

The Maharashtra government was involved in facilitating the transaction.

The deal follows a series of consolidation moves in the sector, including Adar Poonawalla's acquisition of a 50% stake in Karan Johar's Dharma Productions for Rs. 1,000 crore in 2024, and Saregama's Rs. 325 crore investment in Sanjay Leela Bhansali's Bhansali Productions.

"The film industry is ripe for consolidation, and companies with strong IPs are likely to attract foreign investors," the official said. In the past, several Hollywood studios like Disney and Paramount either scaled back or exited the Indian market due to challenges around scale.

"Global companies today look for five things when choosing where to invest: talent, policy stability, respect for IP, speed of execution and a complete ecosystem. Mumbai and Maharashtra offer all five. That is why we are seeing sustained global interest across music, films, OTT, gaming, AVGC and the creators economy," Maharashtra CM Devendra Fadnavis said announcing the Excel-Universal deal.

UMG CEO for Africa, Middle East and Asia Adam Granite said the company will remain a minority investor in Excel Entertainment, while retaining a say in creative decisions, even as Sidhwani and Akhtar continue to exercise creative freedom.