Subhas Chandra's Family To Eventually Lift Stake In ZEE To 26 Per Cent: Report

Last week, Japan's Sony terminated a $10-billion merger deal with the Indian broadcaster last week after two years of talks

Sony has sought $90 million in termination fees from Zee for alleged breaches of the terms of the agreement. However, Zee has denied such claims.

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Days after a merger with Sony's India unit collapsed, Zee Entertainment Ltd founder Subhash Chandra's family will eventually lift their stake in the media house to 26 per cent from the current 4 per cent, as reported by Mint on Monday. Last week, Japan's Sony terminated a $10-billion merger deal with the Indian broadcaster last week after two years of talks. The Japanese firm has also sought $90 million in termination fees from Zee for alleged breaches of the terms of the agreement. However, Zee has denied such claims.

Subhas Chandra told Mint, "I have advised my immediate and extended family to increase their shareholding in Zee... We eventually want to go back to 26 per cent, but it will take time."

Chandra, who set up Zee in 1992 and is often dubbed the "Father of Indian Television", is now chairman emeritus at Zee. "Yes, we will need a lot of money. But we are clear that we are not going to raise funds from the outside. We don't want debt," Chandra said.

While Sony and Zee have not elaborated on which merger conditions were unfulfilled, the firms had been at odds over Zee's proposal for its CEO Punit Goenka to lead the combined company, after Goenka became the subject of an investigation by India's market regulator.

Chandra, who is Punit Goenka's father, said, "Punit is the right person to run the company and there is no problem with Zee." The merger collapse also comes as competition heats up in the industry, with rivals billionaire Mukesh Ambani's Reliance and Walt Disney holding merger talks for their India media assets.

Shares of ZEE plunged about 32 per cent on Tuesday after Sony called off the proposed $10-billion merger of its India unit with the media group on last Monday. The market capitalisation of ZEE, which saw heavy selling pressure since morning, tumbled by Rs 7,285.53 crore to Rs 14,974.50 crore on the BSE, last Teusday.