India’s 2nd largest entertainment network, Zee-Sony sign merger agreement

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Zee Entertainment on Wednesday informed that the board of directors of the company at its meeting held on December 21, 2021, The board of directors of entertainment major Zee Entertainment Enterprises (ZEE) has approved the binding agreement with Bangla Entertainment & Pvt Ltd (BEPL) and Sony Pictures Networks India (SPN). The agreements follow the conclusion of an exclusive negotiation period during which ZEEL and SPNI conducted mutual due diligence. After closing, the new combined company will publicly listed in India. The closing of the transaction is subject to certain customary closing conditions, including regulatory, shareholder, and third-party approvals.

A subsidiary of Sony Pictures Entertainment a day after the 90-day exclusivity period of the non-binding bid ended Tuesday. Sony Pictures Networks India Pvt. will own a 50.86% stake. In the merged entity while Zee’s current holding firm Essel will own 3.99%. Public shareholders will have the remaining 45.15% as part of the definitive agreement. Under the terms of the definitive agreements, SPNI will have a cash balance of $1.5 billion at deal closing. Including through infusion by the current shareholders of SPNI and the promoters (founders) of ZEEL.

As per the company’s term sheet, SPE Mauritius Investments Limited will pay Essel. An aggregate amount of USD equivalent of over Rs 1,000 crore towards the non-compete obligations.

Further, the advertisers of Zee have consented to possess not in excess of 20% of its exceptional offers. The advertisers or authors of Zee don’t reserve. Any options to obtain value in the consolidated organization from the Sony Group. Punit Goenka will continue to be the Managing Director and CEO of the merged entity. The majority of the board of directors of the combined company will nominated by the Sony Group and will include. The current SPNI Managing Director and CEO, N P Singh.


“WE GET TALENT AND SCALE FROM MERGERS.”


Agreement Singh will also assume a broader executive position at Sony Pictures Networks India. As the Chairman of Sony Pictures India (a division of SPE). Singh will report to Ravi Ahuja, the chairman of Global Television Studios and SPE corporate. Sony Pictures Networks India was advised on this transaction by Morgan Stanley, KPMG Corporate Finance, and Shardul Amarchand Mangaldas. While ZEE was advised by KPMG, JP Morgan, Trilegal, and Boston Consulting Group.

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