Talks underway as Zee, Sony attempt to revive $10B merger
Zee Entertainment Enterprises Ltd (ZEEL) and Sony Pictures Networks India (SNPI) are in talks to revive their $10 billion merger, which was canceled last month. The Economic Times reports that representatives from both companies have met in Mumbai over the past two weeks to try and salvage the deal, but significant differences remain that could hinder the revival effort. Zee is expected to inform Sony within the next 24-48 hours if they agree to the terms and conditions.
Reasons behind the termination of the Zee-Sony merger
The merger between Zee and Sony was called off on January 22, with Sony issuing a termination letter to formally withdraw from the amalgamation agreement. One of the reasons behind the $10 billion deal falling through was the lack of agreement over who would lead the merged entity. According to the merger terms, the deal was supposed to be completed by December 21, 2023. However, the absence of consensus led to a month-long grace period, which ended on January 21.
Potential impact of Zee-Sony merger on India's entertainment industry
If the merger between Zee and Sony had been successful, it would have created a giant media conglomerate. The combined company would have owned over 70 TV channels, two video streaming services—ZEE5 and Sony LIV—and two film studios—Zee Studios and Sony Pictures Films India. The merged entity would have beeen the largest entertainment network in India. The National Company Law Tribunal (NCLT) had approved the merger scheme on August 10, 2023.
Reliance and Disney are also working out on merger deal
On February 1, it was reported that Reliance Industries and Disney India are working toward a merger plan, with Reliance possibly acquiring a 51-54% stake, valuing Disney's India operations at $3.5 billion. The merger will involve the coming together of Reliance Industries's Viacom 18 broadcast division with Disney India, resulting in the formation of an entertainment powerhouse.
