Sony Pictures Networks India, Zee Entertainment ink merger agreement
Sony Pictures Networks India (SPNI) and Zee Entertainment Enterprises Ltd (ZEEL) on Wednesday proclaimed that they have inked definitive agreements to merge ZEEL with and into SPNI and combine their linear networks, digital assets, production operations and program libraries. The agreements follow the conclusion of an exclusive negotiation period during which ZEEL and SPNI conducted mutual due diligence. After closing, the new combined firm will be publicly listed in India. The closing of the transaction is subject to certain customary closing conditions, including regulatory, shareholder, and third party approvals.
Under the terms of the definitive agreements, SPNI will have cash balance of $1.5 bn at closing, including through infusion by the current shareholders of SPNI and the promoters (founders) of ZEEL, to enable the combined company to drive sharper content creation across platforms, strengthen its footprint in the rapidly evolving digital ecosystem, bid for media rights in the fast-growing sports landscape and pursue other growth opportunities.
Punit Goenka will lead the combined company as its managing director & CEO. The majority of the board of directors of the combined company will be nominated by the Sony Group and will consist of the current SPNI Managing Director and CEO, N P Singh.
On closing, Singh will assume a broader executive position at SPE as chairman, Sony Pictures India (a division of SPE) reporting to Ravi Ahuja, SPE’s chairman of Global Television Studios and SPE Corporate Development.
While SPNI will own a 50.86 per cent stake in the merged entity, Zee’s founders will own 3.99 per cent, as per an exchange filing from Zee. The remaining 45.15 per cent will be with public shareholders as part of the definitive agreement.
The combination of ZEEL and SPNI is likely to achieve business synergies and given their relative strengths in scripted, factual and sports programming, respective distribution footprints across India and iconic entertainment brands, the combined company should be well-positioned to meet the growing consumer demand for premium content across entertainment touchpoints and platforms.
