Sony Group and Zee Entertainment sign definitive merger pact
- ByTejika Bajaj | December 27, 2021
Zee Entertainment Enterprises Ltd., India’s largest television network has recently announced that it has entered into a definitive merger pact with Sony Group Corp’s local unit. This announcement comes amid a complicated boardroom and courtroom feud between Zee’s founder and its shareholders.
While Sony Pictures Network India Pvt Ltd will own a 50.86% stake in the merged entity, Zee’s founder will own a 3.99% stake in the same, as per regulatory filings. The remaining 45.15% stake will be allocated to the public as part of the definitive agreement.
The agreement between both the entities would allow Sony to expand its media business in the second most populous country where Zee Entertainment owns a 17% market stake in the media and entertainment industry.
This development comes three months after Zee and Sony’s non-binding pact was made public that in-turn escalated a takeover battle. Zee’s board has approved the appointment of Punit Goenka (son of Zee’s co-founder Chandra) as the CEO of the newly created entity.
Through this merger, Sony will gain access to the 1.3 billion active users of Zee Entertainment which would allow it to mark its presence in the Indian market. On the contrary, Chandra is doubling down on its efforts to retain the family influence on the indebted firm.
While the definitive agreement has been signed by both the firms, it is still pending approvals from third parties as well as regulatory authorities.
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