NEW DELHI: Zee Entertainment (ZEEL) on Monday said Punit Goenka, who would have been the MD and CEO of the merged entity, was willing to step down from this position in the interest of the merger.
Zee statement came after Sony Pictures Networks India (SPNI) (now known as Culver Max Entertainment) decided to terminate its merger with ZEEL, over two years after it was first announced.
Zee said proposals in this regard were discussed, including for appointment of a director on the Board of the merged company, protections for conduct of pending probes and legal proceedings in the best interest of ZEEL’s directors and shareholders.
“ZEEL proposed an extension of a maximum period of six months for consummation of the transaction, however, Culver Max did not provide any counter proposal for extension. These discussions did not result in any proposal from Sony but they rather have chosen to terminate,” it said.
Goenka’s role and future in the merged entity was the biggest bone of contention between Sony and Zee. Sony is said to have wanted Goenka not to have any executive role or power in any capacity and wanted him to step down from the role of MD and CEO of the merged entity. Earlier, Goenka had faced opposition from Invesco Developing Markets Fund, the largest shareholder of ZEEL.
The hostility against Goenka grew amidst growing scrutiny of market regulator Sebi on allegations that the CEO and his father Subhash Chandra (founder of ZEEL and chairperson of the Essel Group) were abusing their positions in the company and siphoning off funds for their own benefit.
As part of the deal announced in 2021 between the two parties, Goenka was supposed to lead the merged entity even as SPNI would have held a majority stake at 52.93% with most of their members on the Board. Goenka was chosen to lead the merged entity even as the promoter holding in Zee, led by Subhash Chandra and family, is less than 4%.