The National Company Law Tribunal (NCLT) order that approved the merger between Zee Entertainment Enterprises Ltd (ZEEL) and Culver Max Entertainment (earlier known as Sony Pictures Network India) has been challenged by IDBI Bank, said an exchange filing by Zee on Tuesday. The government-run bank has filed the appeal before the Delhi bench of the National Company Law Appellate Tribunal (NCLAT).
"The Company has been served with an appeal on behalf of IDBI Bank Limited against the Company before the NCLAT, Delhi, challenging the order dated August 10, 2023 passed by NCLT, Mumbai Bench, approving the composite scheme of arrangement amongst Zee Entertainment Enterprises Limited, Bangla Entertainment Private Limited and Culver Max Entertainment Private Limited (formerly known as Sony Pictures Networks India Private Limited)," the filing said.
In the order issued on August 10, the Mumbai bench of NCLT dismissed legal objections related to the merger of Zee and Sony India, filled by lenders including Axis Finance, JC Flower Asset Reconstruction Co, IDBI Bank, Imax Corp, and IDBI Trusteeship.
In a deal announced at the end of 2021, Zee and Sony India Network agreed to a $10 billion merger, which will include their television networks, digital assets, product operations, and program libraries. Following the merger, Sony's shareholders will hold a majority stake of 50.86 per cent in the combined entity, while Zee's promoters will retain a 3.99 per cent stake, leaving the remaining 45.15 per cent for ZEEL's shareholders.
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The deal has encountered many challenges, including the Securities and Exchange Board of India (SEBI) barring Zee's promoters, Punit Goenka and Subhash Chandra, from serving on the boards of four Zee group companies, including Zee Entertainment Enterprises Ltd.
In the trading session on September 5, the shares of Zee closed at Rs 274.85 on the BSE, 3.54 per cent higher than the previous day's closing.