Zee Entertainment shows signs to merge with Sony Pictures Networks India Private Limited, the company said on Wednesday. The company also said that Puneet Goenka will continue to provide services to the merged company as CEO and MD for a period of 5 years.
ZEE Entertainment said:
“The Board of Directors of ZEEL at its meeting held on September 22, 2021, has approved the execution of a non-binding term sheet (“Termsheet”) with Sony Pictures Networks India Private Limited (“Sony India”), in relation to a potential transaction involving a composite scheme of arrangement for the merger of the Company and Sony India and infusion of growth capital by the promoters of Sony India into Sony India as part of the merger.”
After the deal takes place, promoters of Sony will have the right to appoint the majority of directors to the merged company. Sony India will hold 52.93 per cent, whereas Zee Entertainment will hold a 47.07 per cent stake in the merged company. Zee Entertainment and Sony Pictures have agreed to bind for 90 days.
As per the term sheet, the promoter family is free to maximize their shareholding up to 20 per cent from 4 per cent. Earlier, Zee Entertainment saw shareholder activism which spotted an open call for the ouster of promoters and the incumbent management led by Goenka.