A day after the deadline for the $10 billion mega media merger expired, Sony Group sent the termination notice to Zee Entertainment Enterprises Ltd on Monday. Sony has said that it will call off the deal between Zee media network and its India unit. On Friday, Zee had sent a request to Sony for the second extension for the merger. The merger was supposed to be completed by December 2023. At that time, Zee had requested for the extension to which Sony had agreed.
Sony has communicated to Zee that it is terminating the merger due to ‘unmet conditions.’ In an official statement, Sony Pictures Entertainment said that, “Culver Max Entertainment (CME) today issued notice to Zee Entertainment Enterprises Ltd. (ZEEL) terminating the agreement dated December 22, 2021, to merge ZEEL and CME.”
The statement further said that, “Although we engaged in good faith discussions to extend the end date under the merger cooperation agreement, we were unable to agree upon an extension by the January 21 deadline. After more than two years of negotiations, we are extremely disappointed that closing conditions to the merger were not satisfied by the end date.”
“We remain committed to growing our presence in this vibrant and fast-growing market and delivering world-class entertainment to Indian audiences,” the statement said in the end.
After Sony issued the statement, Zee has also broken silence. In the official statement, ZEE Entertainment Enterprises Chairman R Gopalan said, “The Board of Directors has taken note of Sony’s letters purporting to terminate the Merger Co-operation Agreement, on the Company’s proposed merger with and into Culver Max Entertainment Pvt. Ltd, invoking arbitration and seeking interim reliefs. We are evaluating the next steps and considering the appropriate course of action. 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 interest of all stakeholders, including by taking appropriate legal action and contesting Culver Max and BEPL’s claims in the arbitration proceedings. The Board has complete faith in the highly experienced senior management of the Company and will continue to guide the team. We recognize and value the trust our shareholders and stakeholders place in us, and we express gratitude for their continued support.”
The mega media deal, which was announced more than two years ago, hit a roadblock over the leadership of the merged entity. There were concerns over the future leadership of the merged entity amid a market regulator probe into Zee CEO Punit Goenka.