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ZEE Entertainment Enterprises Limited Confirms Merger Talks With Sony Pictures Networks India
ZEE Entertainment Enterprises Limited (ZEEL) has confirmed merger talks with Sony Pictures Networks India (SPNI) on Wednesday, 22 September 2021. The news has come across as a surprise to many, with the Board of Directors of ZEE Entertainment Enterprises Limited unanimously providing an in-principle approval for the merger with Sony Pictures Networks India.
SPNI will also infuse growth capital as part of the merger as it has approximately $1.575 billion for pursuing other growth opportunities. The combined entity of the two companies will see Sony being the majority stakeholder with 52.93% in the merger whilst ZEE shareholders will take the remaining 47.07% stake. ZEE network currently operates 49 entertainment channels across 11 languages while Sony India runs 26 channels across entertainment and sports genres.
A statement from ZEEL said, “Basis the existing estimated equity values of ZEEL and SPNI, the indicative merger ratio would have been 61.25% in favour of ZEEL. However, with the proposed infusion of growth capital into SPNI, the resultant merger ratio is expected to result in 47.07% of the merged entity to be held of all the shareholders and ZEEL. We have unanimously provided an in -principle approval to the proposal and have advised the management to initiate the due diligence process.”
ZEEL chairman R. Gopalan also spoke about the development and said, “The Board of Directors at ZEEL have conducted a strategic review of the merger proposal between SPNI and ZEEL. As a Board that encompasses a blend of highly accomplished professionals having rich expertise across varied sectors, we always keep in mind the best interests of all the shareholders and ZEEL. We have unanimously provided an in- principle approval to the proposal and have advised the management to initiate the due diligence process.
He added, “ZEEL continues to chart a strong growth trajectory and the Board firmly believes that t his merger will further benefit ZEEL. The value of the merged entity and the immense synergies drawn between both the conglomerates will not only boost business growth, but will also enable shareholders to benefit from its future successes. As per legal and regulatory guidelines, at the required stage, the proposal will be presented to the esteemed shareholders of ZEEL for their approval.”
