The Walt Disney Co, the second-largest U.S. media company, said on Monday it will pay $203 million to raise its stake in India's UTV Software Communications Ltd from 14.9 percent to 32.1 percent.

Disney, based in Burbank, California, agreed to purchase new stock and some shares from minority holders, according to an advertisement in the Business Standard newspaper. The move will increase Disney's stake in India's UTV Software Communications and make it one of the biggest investments yet by Hollywood in South Asia's entertainment sector.

The offer opens on April 11 and will close on April 30, the advertisement said.

India has the world's third-largest cable TV market and is forecast to become Asia's most lucrative pay TV market by 2015.

Disney and UTV founders have made a joint open offer to acquire a further 20 percent in UTV Software Communications Ltd at the same price as per Indian takeover rules.

UTV was founded by Indian media entrepreneur Ronnie Screwvala and it produces television and movie content, makes gaming software and broadcasts television channels. The group is known overseas for last year's box-office hit The Namesake.

For a period of four years from the offer completion date, Ronnie and the promoter group would have a right to buy any shares that Disney would acquire as a result of the open offer and during this time Disney would not be able to exercise its voting rights on the shares acquired pursuant to the open offer, the company said in a statement.

The board of directors will now be equally represented by three members each of UTV and Walt Disney, besides there will be six independent members, the company said.

Disney's increased commitment to UTV follows a series of similar deals being agreed in India, with NBC Universal buying a 26 percent stake in the entertainment division of New Delhi Television for $150 million while Viacom partnered with TV18, which runs India's version of CNBC.