On August 27, Zee shares closed 11% higher at Rs 150.90 apiece.
According to information provided to the exchanges, the companies will withdraw their respective Composite Schemes of Arrangement from the NCLT and inform the concerned regulators, thereby terminating the $10 billion deal.
Also read: Zee shares rise over 11% after company signs settlement agreement with Sony India
In addition, the entertainment giants have agreed to waive all rights to assert claims and counterclaims against each other with respect to and arising out of the Transaction Documents, including their termination and implementation.
The settlement also includes withdrawal of all claims related to the $90 million severance payment, damages, litigation and other costs incurred, and all claims related to the costs of divestiture, spin-off, winding up, liquidation, business closure and/or other assets. Earlier in April, Zee Entertainment Limited (ZEE) had announced that it had decided to withdraw the merger implementation petition filed against Culver Max Entertainment (Sony) in the National Company Law Tribunal (NCLT) in Mumbai. The Puneet Goenka-led company had also stated that the decision allows it to “continue to aggressively pursue” all its claims against Sony during the ongoing arbitration proceedings at the Singapore International Arbitration Centre (SIAC) and other forums.
The Zee-Sony merger
On August 10, 2023, the NCLT panel in Mumbai approved ZEEL's plan to merge with BEPL and Culver Max Entertainment, two Sony group companies. This merger could have resulted in the creation of a media company valued at $10 billion.
The merger was called off by Sony on January 22. Zee's inability to meet certain financial terms of the agreement and develop a strategy to remedy them contributed to the decision for the change. Responding to the allegations, Zed said the Japanese company acted in “bad faith” when it called off the merger.
The merger of Sony and Zee would have created the country's largest entertainment network, owning over 70 television channels, two video streaming services (ZEE5 and Sony LIV) and two film studios (Zed Studios and Sony Pictures Films India).
