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ZEEL approaches NCLT seeking implementation of merger deal with Sony
Zee-Sony Merger
Photo courtesy: IBNS

ZEEL approaches NCLT seeking implementation of merger deal with Sony

| @indiablooms | 24 Jan 2024, 10:51 pm

Mumbai: Zee Entertainment Enterprises Ltd on Wednesday took legal actions by filing petitions with the National Company Law Tribunal in Mumbai and initiating proceedings at the Singapore International Arbitration Centre after Sony's termination of a $10-billion merger deal, media reports said.

Zee has approached the National Company Law Tribunal, seeking directives to facilitate the implementation of the merger with Sony India.

Zee refuted Sony's allegations of breaching obligations under the agreement and has opted for legal recourse to challenge these claims through arbitration proceedings at the Singapore International Arbitration Centre.

"The Company approached the Hon’ble National Company Law Tribunal, Mumbai bench inter alia seeking directions to implement the merger scheme. The Company initiated appropriate legal action to contest Culver Max and BEPL’s claims in the arbitration proceedings before Singapore International Arbitration Centre (SIAC)," said Zee in a stock exchange filing.

"The company has complied with all its obligations in good faith," Zee said in a stock exchange filing.

"The Company has denied that Culver Max and BEPL are entitled to terminate the MCA and the claim for termination fee is legally untenable and has no basis whatsoever. The Company asserted that Culver Max and BEPL are in default of their obligations to give effect to and implement the Scheme, sanctioned by the Hon’ble National Company Law Tribunal," added Zee.

On Monday, Sony Group Corp officially announced the cancellation of the merger between its India unit and Zee Entertainment, citing a deadlock over the leadership structure of the merged entity as the primary reason.

The termination notice for the deal was first announced over two years ago.

Sony is now seeking $90 million as break-up fees, alleging a violation of the terms of the merger agreement and is invoking arbitration to address the dispute.

The impasse regarding leadership is reported to be the key factor behind the dissolution of the deal.

Sony resisted the demand from Zee's Chief Executive, Punit Goenka, who had faced an investigation by market regulator SEBI over fraud allegations, to retain his position post-merger.

The merger was considered crucial for both companies in navigating the challenges of the world's fastest-growing large economy.

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