No stay on Zee-Sony merger, case hearing on January 8
The National Company Law Appellate Tribunal (NCLAT) has decided not to halt the merger between Sony and Zee Entertainment Enterprises Limited (ZEEL). However, the tribunal has issued a notice regarding the plea and scheduled a hearing for January 8. The merger of the two media giants was contested in the NCLAT by IDBI Bank and Axis Finance.
IDBI Bank's concerns and ZEEL's objections
During the hearing, IDBI Bank was represented by Additional Solicitor General (ASG) N Venkatraman. He argued that ZEEL had guaranteed loans for an Essel entity, and they would be unable to recover the money from ZEEL if the merger proceeds. Venkatraman urged the NCLAT to pause the merger's progress. In response, senior advocates Abhishek Manu Singhvi, Mukul Rohatgi, and Arun Kathpalia, representing ZEEL, opposed any halt being granted.
What did the ZEEL representatives claim?
ZEEL's lawyers argued that neither IDBI nor Axis Finance have the legal standing to file the plea. Rohatgi also informed the court that these firms lack the necessary lending or share capital as per law to challenge the Zee-Sony merger.
NCLAT's decision and future hearing
The NCLAT acknowledged that while the merger is subject to court orders, they cannot halt it without hearing the case based on its merits. The tribunal directed responses to be filed and postponed the case to January 8. To recall, the National Company Law Tribunal (NCLT) approved the merger of Sony Pictures Networks India and Zee Entertainment, on August 10, setting the stage for a $10-billion media behemoth in India.
