Zee moves NCLT after Sony’s dismissal of $10 billion-deal

25 Jan 2024 , 10:17 AM

On January 24, Zee Entertainment Enterprises Ltd (ZEEL) filed a petition with the National Company Law Tribunal (NCLT) and the Singapore International Arbitration Centre (SIAC) challenging Sony Pictures Network India’s termination of the merger agreement.

The business has petitioned the Mumbai-based NCLT, ‘seeking directions to implement the merger scheme,’ the Punit Goenka-led media conglomerate stated in a regulatory statement.

Sony cancelled the proposed merger, which would have formed a $10 billion media conglomerate, by sending a termination letter to ZEEL on January 22.

According to the merger agreement signed on December 22, 2021, Zee, Sony Pictures Networks India (now known as Culver Max), and Bangla Entertainment Pvt Ltd were to merge into a single firm within 24 months.

Following the deadline last month, both companies engaged in a month-long discussion that apparently failed due to a lack of agreement on who would lead the amalgamated entity. While Zee wanted Goenka, its MD and CEO, to lead the amalgamated business, Sony preferred N P Singh, according to sources.

In its exchange filing, ZEE expressly refuted the claim of failing to satisfy the merger terms. The firm has ‘complied with all of its obligations in good faith,’ it stated, adding that Culver Max and BEPL have no right to terminate the merger agreement.

Zee has also rejected Sony’s demand for a $90 million termination fee, claiming that such a demand is ‘legally untenable and has no basis whatsoever’.

Culver Max and BEPL are in ‘default of their obligations’ to make the merger into effect, Zee noted, adding out that the merger was approved by the NCLT last year.

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