Zee Rubbishes Report Of Sony Exiting $10B Deal, Shares Recover

Zee Entertainment Enterprises on Tuesday refuting media reports that Sony was abandoning the proposed $10 billion merger with the company.

What Happened: In a regulatory filing, Zee stated its commitment to the merger with Sony, underscoring ongoing efforts toward a successful conclusion of the deal.

This follows a media report indicating that Sony Group was considering cancelling the deal due to a disagreement over whether Zee CEO Punit Goenka should lead the merged entity.

Zee labeled the report as “baseless and factually incorrect,” asserting compliance with SEBI Regulations, 2015. The company pledged to continue making disclosures in accordance with regulatory obligations.

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Why It Matters: The fate of the proposed merger between Zee and Sony remains uncertain as the one-month grace period, ending on January 21, approaches. The parties have struggled to finalise an agreement, particularly regarding the leadership of Goenka after the Securities and Exchange Board of India (SEBI) barred him from holding managerial posts due to a fund-diversion case.

Subhash Chandra and Goenka moved the Securities Appellate Tribunal (SAT) challenging the interim order. In October, SAT quashed the Sebi interim order.

Price Action: Following the news, Zee Entertainment’s shares initially dropped 10% during the opening hours. However, the stock had recovered from its lows in the afternoon, trading only 5.84% down at ₹261.90 apiece.

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