A new impasse has arisen over the proposed merger of the Indian unit of Sony Group Corporation and Zee Entertainment Enterprises Limited. Something concrete can be known about the fate of the merger only next week. Sources familiar with the matter said that the companies have very little time left to resolve their disagreements and complete the deal. The net worth of the entity formed after the merger will be approximately $10 billion.
According to sources, until both the parties finalize the details related to the merger and agree on who will command the entity formed after the merger, challenges will remain. Sony Group may send a letter to Zee next week to inform that some of the demands of Zee Group related to the merger cannot be met. This letter can create great difficulties for the deal, because the time till December 21 may not be enough to remove all the obstacles. The deadline for the deal has been formally set for December 21.
Zee Entertainment demands that its CEO Punit Goenka be appointed as the boss of the new entity, as stipulated in the agreement signed in 2021. However, Soni is in a dilemma regarding his appointment due to the SEBI investigation against Goenka. Because of this, tension has increased between the two parties in the last stages of the merger. Many disagreements have already been seen between the two parties in this deal.
Without commenting on the leadership issue, a Zee representative said, ‘The company is actively working to fulfill all the terms and conditions of the deal. Zee has already fulfilled most of the conditions and is in regular touch with Sony in this regard. Sony representatives did not respond to an email sent by Moneycontrol. There was an agreement between Sony and Zee in 2021 regarding the merger. Under this, Sony’s stake in the merged entity will be 50.86 percent, while the Goenka family will have 3.99 percent stake.
