Zee Entertainment Moves NCLT To Implement Sony Merger Deal
Culver Max Entertainment Pvt., had issued a notice terminating the definitive agreements entered with Zee
Zee Entertainment Enterprises Ltd. has moved the National Company Law Tribunal seeking directions to implement the merger with Sony Group Corp.'s Indian subsidiary.
Zee issued a reply to Sony Pictures Networks India Pvt., specifically denying any breach of obligations under the MCA and reiterated that the company has complied with all its obligations in good faith, according to an exchange filing on Wednesday.
Sony Pictures, now called Culver Max Entertainment Pvt., had issued a notice terminating the definitive agreements entered with Zee.
Zee has denied that Culver and Bangla Entertainment Pvt. are entitled to terminate the MCA and the claim for termination fee of $90 million "is legally untenable and has no basis whatsoever".
Zee has initiated appropriate legal action to contest Culver and BEPL’s claims in the arbitration proceedings before the Singapore International Arbitration Centre, it said.
Zee promoter Subhash Chandra has written to Union Finance Minister Nirmala Sitharaman, accusing SEBI of trying to scuttle the conglomerate's merger with the Japan-based company.
In a Jan. 16 letter, that NDTV Profit has reviewed, Chandra said the capital markets regulator had been acting with a "predetermined mind" and sought Sitharaman's intervention to safeguard the interest of minority shareholders.
The key question has been if Punit Goenka would lead the combined entity. The Securities and Exchange Board of India had barred him from holding a key managerial position over alleged fund diversion. While he won relief from the Securities Appellate Tribunal, the regulatory scrutiny continues.
NDTV Profit had earlier reported that the Sony Group had rejected two proposals from Zee. The first proposal was to allow the merger to go through as cleared by the shareholders, with Goenka helming the merged entity initially. A joint hunt for a 'neutral' CEO acceptable to both sides would then be found to run the entity.
The second proposal was that Goenka would step down from his position as CEO, but retain a seat on the board. A board seat for a nominee of the promoters as an alternative was also offered. NDTV Profit learned that both these proposals were rejected by Sony.
Shares of Zee recovered on Wednesday after it tanked over 30% on Tuesday following the termination of the deal.
Shares of Zee closed 6.70% higher at Rs 166.35 apiece, as compared with a 0.98% advance in the benchmark BSE Sensex.
