Sony terminates Zee merger, demands a termination of $90 million

After weeks of speculation, Zee and Sony's merger has been called off. Zee Entertainment has now approached the NCLT and the Singapore International Arbitration Centre against Sony, for termination of the merger. 
Sony in a release has said that although we engaged in good faith discussions but we're unable to agree upon an extension post 21st January. They further added that even after more than two years of negotiations they are disappointed that closing conditions to the merger were not able to meet by the end date. On the other hand, Zee has revealed that Sony has not agreed to an extension on the deal in order to terminate it and is also demanding $90 million as compensation for not adhering to the terms of the merger.  Zee denies all the claims that Sony has made and further added that they were willing to take the deal ahead. Punit Goenka was agreeable to step down as MD and CEO in interest of the merger.

R Gopalan, Chairperson of Zee Entertainment Enterprises said, "The board has noted that the Company took all the required steps in the course of its integration journey over the last two years, to ensure that the scheme is implemented at the earliest. That said, the board would like to assure its stakeholders that the company will take all the necessary actions, in the best interests of all stakeholders, including taking appropriate legal action and contesting Culver Max and Bangla Entertainment Pvt Ltd's claim."

“The fallout of the failed merger will compound problems for Zee and it could see institutional investors voicing their concerns for a change. However, the current management would have been cognizant about this and would have already created a contingency plan to tackle this,” TOI quoted N V Capital’s managing partner Vivek Menon as saying.

• On 21st September 2021, Zee approved its merger with Culver Max Entertainment Pvt Ltd, former Sony Pictures Networks India Pvt Ltd. This merger deal was officially signed in December 2021 after a 90 day due diligence period.
• On 22nd February 2023, NCLT accepted insolvency against Zee Entertainment Enterprises ZEEL in response to the IndusInd Bank's petition.
• On 12th June 2023, SEBI bans Subhash Chandra and Punit Goenka for fund misappropriation.
• On 10th August 2023, National Company Law Tribunal (NCLT) approved the merger, dismissing objections.
• On 14th August 2023, SEBI investigates Goenka and Chandra.
• On 26th August 2023, Goenka challenges SEBI's order at SAT.
• On 30th October 2023, SAT quashes Securities and Exchange Board of India's order on Goenka.
• On 17th December 2023, ZEE seeks a merger deadline extension.
• On 18th January 2024, Goenka offered to step down as CEO.
• On 22nd January 2024, Sony officially called off the merger.