NEW DELHI: 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 on 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 and Sony did not respond for comment. Sony and Zee announced their merger in December 2021. 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.
The merger stuck over the issue of leadership of the merged entity. The Sony Group is opposed to Goenka being at the helm of the merged entity, while Zee Group has been insisting on him leading it as was agreed under the terms of the agreement.