ZEE's share price witnessed a decline of over 10 per cent on Tuesday following the cancellation of its mega-merger with the Indian subsidiary of Culver Max Entertainment (Sony).
After a prolonged delay, Sony officially terminated its mega-merger with ZEE, citing non-compliance and extended negotiations. The deal, slated to conclude on December 21, 2023, was subject to regulatory and other approvals, with a one-month grace period allocated for finalizing the merger. Despite this extended timeframe, Zee failed to meet the necessary conditions. This prompted Sony to issue an official statement calling off the $10 billion merger, as the conditions were not met even after the grace period.
At 09:55 am, the shares of Zee Entertainment Enterprises Limited were trading at Rs 208 price level, down by almost 10 per cent on the National Stock Exchange.
Before December 21, 2023, the merger, which included regulatory and other approvals, was mandated to be finalized. A grace period of one month was provided for completing the transaction. On Monday, after ending the agreement, Sony demanded $90 million in termination fees from Zee.
However, Zee Entertainment has, in turn, announced its intention to pursue legal action against the Japan-based media Group in response to the cancellation of the merger.
On 22nd January, Zee stated in an exchange filing, "The Company is evaluating all available options and basis the guidance received from the Board and will take all necessary steps to safeguard the long-term interests of its stakeholders, including by taking appropriate legal action and contesting Culver Max and BEPL’s claims in the arbitration proceedings."
