Zee Entertainment Board Approves Zee-Sony Merger, Sony To Hold 50.86 Percent Stake

New Delhi: The Zee Entertainment Enterprises Limited (ZEEL) board on Wednesday approved the merger with Sony Pictures Networks India (SPNI) after a 90-day period to conduct due diligence for the process.

Notably, in November, Zee MD and CEO Punit Goenka had said that the proposed merger is in the final stages.

As per the deal, Sony will hold 50.86 percent stake in the merged entity after investing $1.5 billion. On the other hand, Zee will hold 45.15 percent.

There will be five Sony executives in the merged entity's nine-member board and the merged entity will be a publicly listed company in India.

''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 be publicly listed in India,'' said ZEE Entertainment in its regulatory filing on Wednesday.

After merging, both ZEE and Sony combined will own over 70 TV channels, 2 video streaming services such as ZEE5 and Sony LIV and two film studios like Zee Studios and Sony Pictures Films India. With these figures, the combined entity will be largest entertainment network in India.

Meanwhile, shares of ZEE Entertainment Enterprises ended 5.26 percent to Rs 349 apiece on Bombay Stock Exchange (BSE).

According to an official statement, as part of the transaction, Punit Goenka will continue to be the Managing Director and CEO of the merged entity. Further, certain non-compete arrangements will be agreed upon between the promoters of ZEEL and the promoters of SPNI.

According to the term sheet, the promoter family is free to increase its shareholding from the current 4 percent to up to 20 percent, in a manner that is in accordance with applicable law.

Majority of the Board of Directors of the merged entity will be nominated by Sony Group.

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