Zee-Sony Merger: NCLAT Adjourns Hearing Of IDBI Bank's Appeal Against Approval
IDBI Bank contested the approval given by the Mumbai bench of the NCLT in August for the merger.
The NCLAT on Wednesday adjourned to Dec. 6 the hearing of the appeal by IDBI Bank Ltd. against the merger of Zee Entertainment Enterprises Ltd. and Culver Max Entertainment Pvt.—also known as Sony Pictures.
IDBI Bank and Axis Finance have contested the approval given by the National Company Law Tribunal in August for the merger between Zee and Sony, which would result in the formation of the largest media entity in the country.
The merger agreement was initially finalised in December 2021. After obtaining necessary approvals from various regulators like the NSE, BSE, SEBI and the Competition Commission of India, both companies sought the final approval from the tribunal.
However, the merger process encountered delays primarily due to objections raised by Essel Group creditors, including Axis Finance Ltd., JC Flowers Asset Reconstruction Co., IDBI Bank, IDBI Trusteeship Ltd., and Imax Corp.
The primary point of contention centred around a non-compete clause outlined in the scheme. This clause stated that Essel Mauritius, which is an Essel Group company, was entitled to receive Rs 1,100 crore as non-compete fees from SPE Mauritius, a company within Sony Group.
In return, Subhash Chandra, the chairperson of Essel Group, agreed not to compete with the resulting entity formed as a result of the merger between Zee and Sony.
