Zee Could Seek NCLT To Enforce Merger Deal With Sony After SIAC Rejects Petition

The SIAC said that it has no jurisdiction or authority to refrain Zee from seeking the NCLT and the merger deal came under the purview of the NCLT of India, Zee informed via an exchange filing

Zee Entertainment approached the Indian tribunal to enforce the multibillion-dollar deal with Sony Group’s Indian unit after the latter’s emergency plea got rejected by a Singapore arbitration centre, the company said on Sunday. 

The $10 billion deal between the two media entities got scrapped on January 22, 2024, when Sony ended the deal citing breaches of contract, reported Reuters. Zee has since denied the claims and approached the National Company Law Tribunal of India, asking it to instruct Sony to honour the deal obligations and complete the merger. 

Sony Group took the matter to the Singapore International Arbitration Centre (SIAC) seeking a pause on the proceedings initiated by Zee. However, the SIAC stated that it has no jurisdiction or authority to refrain Zee from seeking the NCLT. The Singapore-based authority further said that the merger deal came under the purview of the NCLT of India, Zee informed via an exchange filing.

Responding to the developments, Sony said that it was disappointed by the decision, however, it noted that it was a procedural one ruling only regarding if Zee could pursue its plea with the Indian tribunal. 

“We will continue to vigorously arbitrate the matter in Singapore in front of a full SIAC tribunal and pursue SPNI's (Sony India) right to terminate the merger agreement and seek a termination fee and other remedies. We remain confident in the merits of our position in both Singapore and India,” Sony added. 

Notably, the deal between the two media companies has been in process for two years, and if completed, would have been successful in developing the largest media and entertainment entity in India. The combined entity would operate over 90 channels, across entertainment, news, and sports, and would have been the direct competitor of big names like Walt Disney, and Mukesh Ambani’s Reliance. 

The news agency also reported that Sony cited the alleged failure by Zee in meeting certain financial requirements of the deal, while ending the merger. The report noted that the Indian wing of the Japanese Sony Group called off the merger over a conflict regarding compliance issues including the disposal of some Russian assets and the $1.4 billion Disney cricket rights deal.