ZEE-Sony merger: Parties likely to get a month’s time to complete deal - Reports

Following Zee Entertainment Enterprises Ltd (ZEEL) seeking extension of the deadline of its proposed merger with Culver Max Entertainment (CMEPL), formerly Sony Pictures Networks India (SPNI), and Sony agreeing to hear ZEEL’s proposals and how they plan to complete the remaining critical closing conditions, the merger parties are likely to get a period of 30 days to close the merger deal, as per media reports that quoted people close to the development.

Media reports stated that as per the existing contractual provision in the merger deal, a 30-day grace period is allowed if either party sought extension of the merger deadline date of December 21, 2023.

As reported earlier, as per a filing with the BSE and NSE, ZEEL had stated that it “has requested CMEPL and Bangla Entertainment Pvt Ltd (BEPL) to extend the date required to make the scheme effective, as per the terms of the Merger Cooperation Agreement”.

A day after ZEEL sought extension of the deadline, Sony said that the notice triggers an existing contractual provision in the deal that allows for both parties to discuss the possibility of extending the deadline.

In an official statement issued, SPNI said, “ZEE’s notice to the Bombay Stock Exchange and the National Stock Exchange of India, dated December 17, is an acknowledgement that they will not be able to meet the December 21, 2023 deadline to close the SPNI/ZEE merger. The notice triggers an existing contractual provision in the deal that allows for both parties to discuss the possibility of extending the deadline.”

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SPNI further stated that it is required to start those conversations, but has not yet agreed to a deadline extension. “We look forward to hearing ZEE’s proposals and how they plan to complete the remaining critical closing conditions,” the statement added.

In a filing to the bourses on December 20, 2023, ZEEL informed that it has received “a communication from CMEPL and BEPL that they will enter into good faith negotiations as required under the Merger Cooperation Agreement (MCA) entered amongst the parties – ZEEL, CMEPL and BEPL – with a view to discuss the extension of the date required to make the Scheme effective by a reasonable period of time”.

ZEEL had entered into the Merger Cooperation Agreement with BEPL and CMEPL on December 22, 2021. The proposed merger is slated to create India’s biggest media conglomerate. As per industry reports, the merger is valued at $10 billion. The proposed merger has received the necessary regulatory approvals from the Competition Commission of India, Bombay Stock Exchange, National Stock Exchange, as well as the shareholders and creditors of ZEEL.