Even as the share prices of Zee Entertainment Enterprises Ltd. crashed nearly 13% in early trades on January 9, the media house denied reports that said that Sony was planning to call off the proposed Zee-Sony merger. Zee said, it remained committed to the merger and was continuing to work towards its successful closure. On the other hand, Sony refrained from making any comment.
After the expiry of the December 21, 2023 deadline to conclude the merger, Zee entered into a 30-day negotiation during which either of the companies could terminate the deal or further extend the timeline.
Zee on January 9 late afternoon called the report about Sony planning to cancel the proposed merger deal “incorrect”. Following this, the Zee stock regained some of the lost ground to close 7.6% down. The stock opened the session at Rs. 250, down nearly 10% on the day, dipped to its intraday low at Rs. 242 and closed at Rs. 256.
Although the proposed merger has received most of the customary approvals, it still needs two more nods — one from the ministry of information and broadcasting and the other from the registrar of companies. For the I & B ministry’s clearance, Sony needs to submit the names of the directors who will occupy the board of the merged entity. While Zee managing director and CEO Punit Goenka is insisting that he would head the merged company (as provided in the merger proposal), Sony wants its nominee to be at the helm of affairs in view of the regulatory probe against Punit and his father, Subhash Chandra, in the financial affairs of Zee. Hence Sony is unable to submit the list.