India has given approval for the merger of Zee Entertainment and the Indian unit of Japan’s Sony Group, paving the way for a $10 billion media and entertainment powerhouse.
The National Company Law Tribunal’s clearance of the long-delayed deal resulted in Zee’s shares surging by 16.6%. The merged entity will be majority-owned by Sony Pictures Networks India (SPNI) at nearly 51%, while Zee’s founders will hold 3.99%.
Zee Group is one of India’s pioneering privately owned television networks, and observers believe the Sony-Zee alliance is poised to become the country’s largest industry player, wielding substantial distribution and advertising capabilities.
The Sony line-up includes Indian Idol and a version of Who Wants to be a Millionaire. There are also two local streaming services Zee5 and SonyLiv.
Although the merger, announced in September 2021, encountered hurdles like the Securities and Exchange Board of India’s ban on Zee’s CEO from boardrooms for a year, the formation of an interim committee by Zee to manage operations ensured progress. Despite the CEO’s situation, the merger is set to proceed.
To alleviate regulatory concerns, Zee and Sony made concessions such as pricing discounts, gaining competition approval for the merged entity.
The merged operation will compete with Walt Disney India and Network18, owned by billionaire Mukesh Ambani.
