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Media and entertainment conglomerate ZEE Entertainment Enterprises Ltd. (ZEEL) has received approval from the Bombay Stock Exchange (BSE) and National Stock Exchange (NSE) for its proposed merger with Culver Max Entertainment Pvt Ltd, formerly known as Sony Pictures Networks India Pvt Ltd, the company said in a statement on Friday.
Calling it a firm and positive step in the overall merger approval process, the company said the approvals permit it to proceed with the next steps towards the same that is now subject to approvals from CCI (Competition Commission of India), NCLT (National Company Law Tribunal) and shareholders.
Last December, the two companies had announced that they have signed definitive agreements to merge and combine their linear networks, digital assets, production operations and program libraries. The agreements had followed the conclusion of a negotiation period during which ZEEL and SPNI conducted mutual due diligence, the two companies had said in a statement. After closing, the new combined company will be publicly listed in India.
Punit Goenka will lead the combined company as its managing director and CEO. The majority of the board of directors of the combined company will be nominated by the Sony Group and will include the current SPNI managing director and CEO, N.P. Singh. On closing, Singh will assume a broader executive position at SPE as chairman, Sony Pictures India (a division of SPE) reporting to Ravi Ahuja, SPE’s chairman of Global Television Studios and SPE corporate development. The combined entity will own 75 television channels, two video streaming services, two film studios and a digital content studio. Media industry analysts say both firms should complement each other. While Sony has a rich catalogue of sports and mainstream general entertainment channels (GECs), Zee has great recall in the regional space. Both have very strong movie libraries, they point out.
To be sure, Zee’s founding family had been embroiled in a bitter battle with Invesco, its largest shareholder for three months before the merger announcement, which had approached a division bench of the Bombay high court to challenge an earlier order that had restrained the US fund manager from calling a special shareholders’ meet to remove managing director Punit Goenka and reconstitute the Zee board. Zee had challenged Invesco’s attempt to restructure the board in courts and had alleged that the US investor was trying to take over India’s largest publicly-traded broadcaster at the behest of another company.
