Zee Entertainment tanks ~10% as Sony plans to terminate $10 billion merger, says report

9 Jan 2024 , 01:27 PM

Shares of Zee Entertainment fell 10% to Rs 249 a share on 9 January after news surfaced that Japan’s Sony was likely to cancel the merger of its Indian unit with the firm, more than two years after the $10 billion deal was announced.

At around 1.17 PM, Zee’s losses eased and the counter was trading 6.56% lower at Rs 259.90 per piece, against the previous close of Rs 278.15 on NSE.

According to statistics, on January 9, around 1.35 crore shares, or 1.4% equity, of Zee Entertainment were traded at an average price of Rs 252 per share, worth Rs 340 crore.

According to reports, the Sony Group is going to abandon its merger deal with Zee Entertainment owing to a simmering controversy over whether its CEO, Punit Goenka, should run the merged firm.

Though the 2021 deal said that Goenka would run the new company, Sony does not want him as CEO due to ongoing regulatory inquiry.

According to the source, Sony is planning to submit a termination suit before January 20, the extended date for concluding the agreement, citing unmet criteria. Negotiations were still ongoing, and a resolution might be reached by January 20.

In December, the two companies were allowed a grace period of one month to consummate the merger, which would have created a $10 billion media giant.

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