NEW DELHI: The National Company Law Tribunal (NCLT) on Thursday approved merger of Zee Entertainment and Sony Pictures Networks India (SPNI). This will clear path to create a $10 billion media behemoth, which was first announced in September 2021.
The Mumbai bench of NCLT, comprising H V Subba Rao and Madhu Sinha, reserved the judgment after objections raised by multiple creditors such as Axis Finance, JC Flower Asset Reconstruction Co, IDBI Bank, Imax Corp, and IDBI Trusteeship. The tribunal has also dismissed all objections regarding the merger.
“We wish to inform you that the NCLT, Mumbai Bench has today approved 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),” said Zee in a regulatory filing on Thursday.
NCLT had initially reserved its verdict on the merger between Zee and Culver Max Entertainment on July 10. Zee Entertainment shares rallied after the announcement and settled the day at Rs 281.45, up 16.18% from the previous closing price on the NSE. In September 2021, Sony Pictures Networks India (SPNI), a step-down subsidiary of Sony Corp, had first announced a proposed merger with Zee to create one of the country’s largest entertainment networks. The proposed entity will have a market share of 26% in the domestic market.
Since then, the proposed merger was opposed by many parties but the scheme received all the necessary permissions from the stock exchanges, the Competition Commission of India (CCI) and the Securities and Exchange Board of India (SEBI). The fresh NCLT approval came after the market regulator Sebi prohibited Subhash Chandra, Chairman of Essel Group, and his son Punit Goenka in June this year from assuming directorial or major managerial positions in the merged entity due to alleged misuse of funds from Zee for personal gain.