Zee begins talks with creditors to complete the Sony deal: Report
According to persons familiar with the matter, Zee Entertainment Enterprises Ltd. has begun settlement talks with its creditors to reduce debts and eliminate the remaining hurdle in concluding a merger with the Sony Group that would create a $10 billion media empire.
The Indian television network has offered IDBI Bank Ltd., one of the creditors who filed for insolvency, to return a loan of roughly 149 crore rupees ($18.1 million) in installments, according to persons who asked not to be identified because the information isn’t public. Zee’s founders have stated that they are in separate negotiations with Axis Bank Ltd. and JC Flowers & Co.’s asset restructuring section to settle 40 crore rupee debts owed to firms managed by them.
For the merger to succeed, which will create a media business with the biggest viewers and negotiating leverage in the nation of over 1.4 billion people, the repayments are essential. After the transaction is completed, Sony Pictures Networks India Pvt. would possess slightly more than half of the shares, Zee’s founders will own 3.99%, and public shareholders will own the remainder.
Several creditors of the company and its founders had petitioned the bankruptcy court for recovery. IndusInd Bank Ltd. was paid back by Zee, according to a document, and the lender will now drop its concerns over the merger.
The representative for Axis Bank declined to comment, and the representatives of JC Flowers, Zee, and IDBI Bank did not return calls or emails.
Exchange documents show that as of last week, Invesco Developing Markets Fund, based in Atlanta, which had the largest stake in Zee with an 18% ownership at the time the merger announcement was made, had sold all of its shares in the business. In October, India’s antitrust regulator authorised the merger agreement, which had been in the progress for sixteen months.
Zee Entertainment Enterprises is India’s largest publicly listed television network. The merger with Sony has already been approved by shareholders. It has also received merger permission from the Competition Commission of India, the BSE, and the NSE.
A non-binding term sheet between ZEEL and SPNI to integrate their linear networks, digital assets, production operations, and programming libraries was first announced in September 2021.
The combined company will have more than 70 TV stations, two streaming platforms (ZEE5 and Sony LIV), and two movie studios (Zee Studios and Sony Pictures Films India), making it the largest entertainment network in India. SPNI is a completely owned indirect subsidiary of Sony Group Corporation in Japan.
In the Indian market, its main competitors are currently Star and Disney.
Meanwhile, Zee shares fell more than 1% to Rs 195 in the afternoon session on Thursday. Its 52-week trading range is Rs 287 – Rs 176.55.
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