CORPORATEZee-Sony merger: NCLAT sets aside NCLT order to NSE, BSE to reassess deal

Zee-Sony merger: NCLAT sets aside NCLT order to NSE, BSE to reassess deal

Zee-Sony merger – Merger between Zed and Sony: On Friday, a two-member bench of the National Company Law Appellate Tribunal (NCLAT) rejected the NCLT’s direction to the stock exchanges NSE and BSE to reconsider its approval of the merger between Zed and Sony.

The appellate panel instructed the lawyer representing Zed Entertainment Enterprise Ltd. (ZEEL) on Thursday to fix the plea’s errors and order that the case be listed the following day.

The merger of ZEEL and Culver Max Entertainment (formerly known as Sony Pictures Networks India) had already been approved by NSE and BSE, but the NCLT had earlier ordered them to reconsider.

ZEEL had objected to the NCLT’s ruling, claiming that it had not been given a fair chance to make its case. It contested the tribunal’s authority to rule on issues like non-compete fees.

Zee-Sony merger

In 2021, it was reported that Sony Pictures Networks India and Zed Entertainment Enterprises, both helmed by Puneet Goenka, will unite. The merger was approved by the Competition Commission of India (CCI) in 2022 after facing numerous obstacles and conflicts with shareholders. The stock exchanges have also approved of it.

In accordance with the agreement, Sony will own 50.86% of the combined company. The Zed promoters will own 3.99 percent of the combined company, while other Zed stockholders will own 45.15 percent.

With over 70 TV stations, two video streaming service platforms (ZEE5 and Sony LIV), and two film studios (Zed Studios and Sony Pictures Films India), the combined organisation, led by Goenka, will be India’s largest entertainment network after the merger.

Lenders, notably IDBI Bank, Axis Finance, and JC Flower ARC, have opposed Zee’s proposed merger with Sony.

According to reports, the multilingual TV network has proposed repaying IDBI Bank for a debt of roughly Rs 149 crore in instalments.

The business settled the debts owed to IndusInd Bank Ltd., one of its creditors, in March of this year. After that, the lender declared it would drop its protests against the merger, Zed said in a filing.

According to sources, the founders of Zed have been in separate conversations with Axis Bank Ltd. and JC Flowers & Co.’s asset reconstruction section to collect debts totaling Rs 400 million.

Prices for ZEEL shares significantly increased. The shares increased 7% at 12:50 and were trading at Rs. 190.85.


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