Zee, Sony Holding Discussions To Save The $10 Billion Merger: Report

The report stated Zee’s MD and CEO, Punit Goenka, agreed to Sony’s demand that he step aside from the role of Chief Executive Officer of the merged company

Zee Entertainment Enterprises Ltd (ZEEL) and Sony Group are reportedly holding discussions in an attempt to save the $10 billion merger between the two companies, media reports said on Tuesday. 

Citing sources in the know, the Economic Times reported that the media companies are currently in discussions to help save the $10 billion merger, which was called off by the Sony Group earlier in January. The sources said that both companies have been conducting meetings in Mumbai for the last 15 days now.

The report stated Zee’s MD and CEO, Punit Goenka, agreed to Sony’s demand that he step aside from the role of Chief Executive Officer of the merged company. Reportedly, the Japanese media conglomerate stated that Goenka can at best stay as an adviser to the merged entity. 

Zee will notify Sony if it agrees to the terms and conditions of the merger in the next 24 to 48 hours, the report stated. If the former disagrees with the terms, Sony will retract its original application submitted to the National Company Law Tribunal by the end of the week.

Notably, earlier in January, Sony broke off the agreement with ZEEL to create a new media company in India by merging both entities, namely, Culver Max Entertainment, formerly known as Sony Pictures Network India, and BEPL (Bangla Entertainment Private Limited). 

The Japanese group stated that ZEEL failed to adhere to the conditions of the merger and began arbitration proceedings before the Singapore International Arbitration Centre to seek Rs 748.5 crore as a termination fee. 

ZEEL, on the other hand, submitted a petition before the National Company Law Tribunal, urging the tribunal to instruct Sony Group to complete the merger. The company also initiated legal proceedings to contest the termination fee claims filed by the Sony Group before the Singapore authority.

Earlier on August 10, 2023, the NCLT’s Mumbai bench authorised the merger of ZEEL and Sony Group entities, namely BEPL and Culver Max Entertainment, respectively. The merger, if completed, would have created a $10 billion media entity. 

This combined media firm would own more than 70 TV channels, two video streaming services, namely ZEE5 and Sony LIV, and two film studios, Zee Studios and Sony Pictures Films India. This would make this merged entity the largest entertainment network in India.