According to the deal that’s struck between Zee Entertainment and Sony Pictures, the latter will hold a majority stake of 52.93% in the merged entity. ZEEL will be left with 47.07% of the stake
UPDATED ON SEP 22, 2021 02:26 PM IST
The share of Zee Entertainment (ZEEL) zoomed 25% on Wednesday, after the company announced a merger with Sony Pictures India. According to Livemint, the stock jumped to its 52-week high of ₹319.50 on the Bombay Stock Exchange (BSE). At National Stock Exchange (NSE) too, ZEEL was trading at its 52-week high of ₹319.60.
ZEEL said on Wednesday that its board of directors has unanimously provided an in-principle approval for the merger with Sony Pictures Networks India (SPNI).
“The board has evaluated not only on financial parameters but also on the strategic value which the partner brings to the table. The board concluded that the merger will be in the best interest of all the shareholders and stakeholders,” it said in a statement.
According to the deal that’s struck between the two companies, Sony will hold a majority stake of 52.93% in the merged entity. ZEEL will be left with 47.07% of the stake.
SPNI will also infuse $1.575 billion in the entity, ZEEL said in a filing.
ZEEL and SPNI have entered into a non-binding term sheet to combine both companies’ linear networks, digital assets, production operations and programme libraries.
“The merger is in line with ZEEL’s strategy of achieving higher growth and profitability as a leading media and entertainment company across South Asia,” according to a statement from ZEEL.
As part of the agreement, Punit Goenka will continue to be the managing director and CEO of the merged entity. He was facing pressure from two largest shareholders of the company – Invesco and OFI Global China Fund LLC – to quit the post.