Sony calls off $10 bn merger deal with Zee Entertainment
22 Jan 2024
Sony Pictures Networks has ended its long-pending agreement for merger of its television and streaming operations in India with Zee Entertainment Enterprises, saying that closing conditions were not satisfied.
Sony Entertainment today issued a notice terminating the $10 billion merger with Zee Entertainment Enterprises Ltd, at the end of the 24-month period for executing the deal.
The $10 billion merger, which has been in hanging fire for more than two years, had hit several regulatory roadblocks before the National Company Law Tribunal cleared the deal in August.
Sony Pictures Networks India Private Ltd (now known as Culver Max Entertainment Limited), a wholly-owned subsidiary of Sony Group Corporation, had on 22 December 2021, entered into definitive agreements for a merger with Zee Entertainment Enterprises Ltd (ZEEL). But that agreement has been hanging fire over the appointment to Zee’s board of directors.
The merger agreement had also provided that if the merger did not close by the date twenty-four months after their signature date, the parties may discuss in good faith an extension of the end date by a reasonable period of time. Such discussions were required to be held for a period ending 30 days after the end date.
Sony decided to call off the deal as the parties were unable to agree upon such an extension and issued a notice to ZEEL terminating the definitive agreements.
The merger of the linear TV networks, digital assets, production operations and programme libraries of the two companies would have created a media giant, and brought cash to fund-starved Zee Entertainment while providing Sony with 51 per cent stake in local heavyweight Zee, which operates TV channels across the country.
Sony, however, said the termination of the merger will not have any material impact on its consolidated financial results as it has not previously included the deal in its forecasts for the fiscal year.
Sony decided to call off the deal as the parties were unable to agree upon such an extension and issued a notice to ZEEL terminating the definitive agreements.
