NEW DELHI: Zee Entertainment Enterprises Ltd (ZEEL) on Tuesday said that news of the Zee-Sony merger termination is baseless and factually incorrect. On Monday it was reported that media giant Sony Group was on the verge of terminating its proposed $10 billion merger between its India operations and ZEEL.
“We wish to reiterate that the Company is committed to the merger with Sony and is continuing to work towards a successful closure of the proposed merger,” said ZEEL in a statement. ZEEL’s share fell sharply on Tuesday and closed 8% lower at R256.25 apiece.
According to reports, Sony Pictures may pull out of its merger plans with Zee Group over the issue of who should lead the $10-billion merged entity. As per the original agreement, the current MD and CEO of Zee Entertainment Puneet Goenka was to lead the merged entity. Now Sony is rethinking his role after market regulator Sebi barred Goenka from becoming the managing director of the merged entity over allegations of fund diversion.
According to reports, Sony may file a termination notice before 20 January, the extended deadline for completion of the merger, on the grounds that some of the conditions necessary for the merger have not been met. Zee announced their merger in December 2021 to create India’s largest broadcasting entity. Under their agreement, Sony would hold 50.86% stake, Zee promoters to hold 3.99% and other Zee shareholders 45.15% in the merged entity.