Zee moves NCLAT against Sony India's termination of merger deal

Zee-Sony merger: Zee Entertainment Enterprise has moved the National Company Law Tribunal (NCLT) and Singapore International Arbitration Centre (SIAC) against Sony Pictures Network India's termination of the merger deal.

The firm in a regulatory filing said that they had moved the Mumbai bench of NCLAT "seeking directions to implement the merger scheme".

Zee contests deal termination

In a regulatory filing, Zee has mentioned that it compiled with all its obligations in good faith and refuted all claims of Sony of not meeting the merger conditions. Zee further added that Culver Max and BEPL are not entitled to terminate the merger agreement.

Moreover, Zee has also denied Sony's demand of $90 million termination fee, stating that such a demand is "legally untenable and has no basis whatsoever".

Also Read: Zee-Sony merger saga: Punit Goenka says deal termination is a 'sign from the Lord'

Culver Max and BEPL are in "default of their obligations" to bring the merger into effect, Zee added, while pointing out that the merger had already received the nod from the NCLT last year.

"The company has called upon Culver Max and BEPL to immediately withdraw the termination and confirm that they will perform their obligations to give effect to and implement the merger scheme," Zee further noted.

Deal termination

Sony through a termination notice had called off the the proposed merger which would have created a $10 billion media entity on January 22.

"Although we engaged in good faith discussions to extend the end date under the merger cooperation agreement, we were unable to agree upon an extension by the January 21 deadline. After more than two years of negotiations, we are extremely disappointed that closing conditions to the merger were not satisfied by the end date," Sony said in its statement issued on January 22.

Also Read: Zee-Sony saga: Zee set to take legal action as Sony seeks $90 mn termination fee for breach of agreement

As per the merger agreement, inked on December 22, 2021, Zee and Sony Pictures Networks India (now known as Culver Max), along with Bangla Entertainment Pvt Ltd, were to be merged into a single entity within 24 months.

As the deadline was crossed last month, both companies had been involved in a month-long negotiation. As per media reports, the negotiation failed as both the parties failed to reach a consensus on who would be heading the merged entity. Reports suggested that Zee wanted its CEO and MD Punit Goenka to lead while Sony wanted its CEO N P Singh to preside at its helm.