Zee-Sony merger approved; Sony to own 50.86 per cent stake, Punit Goenka to remain CEO
The merged business will comprise prominent channels like Sony MAX and Zee TV and streaming portals ZEE5 and SonyLIV.
FollowAccording to a regulatory statement by the media firm to the stock markets on Wednesday, Zee Entertainment's board of directors authorised the merger between Sony Pictures Networks India and Zee Entertainment Enterprises Limited (ZEEL). Sony will own 50.86 per cent of the amalgamated firm. The promoters of ZEE Entertainment will own 3.99 per cent of the amalgamated business, while the remaining ZEE stockholders would own 45.15 percent.
The agreement calls for the merger of the two competitor broadcasters' television channels, film assets, and streaming platforms. The merged business will comprise prominent channels like Sony MAX and Zee TV and streaming portals ZEE5 and SonyLIV.
Punit Goenka will remain the amalgamated entity's Managing Director (MD) and CEO. The Sony Group will nominate the majority of the merged company's board of directors, including the present SPNI Managing Director and CEO, NP Singh. In a statement, ZEE Entertainment stated that the agreements come after an exclusive negotiation period in which ZEEL and SPNI completed reciprocal due diligence. The newly merged business will be publicly traded in India when the transaction is completed, it added.
The news comes three months after Zee and Sony announced a non-binding agreement on September 22 that exacerbated a takeover war between Chandra's family and Atlanta-based Invesco Developing Markets Fund, which owns 18 per cent of the shares.
Also Read |Â Mumbai grocery startup founded by teens raises $100 million, valuation soars to $570 million in 5 months
The purchase would help Sony develop its media operations in India, the world's second-most populous country, where Zee controls 17% of the media and entertainment sector. When the transaction was initially announced in September, Zee's stock soared 35%, resulting in a market capitalization of approximately $4.5 billion.
SPNI will have a cash balance of $1.5 billion at the time of the deal's conclusion, thanks to an inflow from SPNI's present shareholders and Zee's promoters, according to the firms.
