Zee Entertainment Enterprises Ltd (ZEEL) shares surged 1.1% today after seeing 12% drop on Wednesday. The share price surged after the company denied reports about the termination of the $10 billion merger deal between Zee and Sony.
Sony, on its part, has also clarified that it'll hold talks with Zee on the proposed merger till January 20, 2022.
Zee, via an exchange filing, says: “As per the previous reports of Sony’s consideration of cancelling the deal due to disagreements over the choice of the merged unit's CEO, negotiations on the deal's terms are still in progress.”
The company reiterated that it is committed to the merger with Sony and is continuing to work towards a successful closure of the proposed merger.
Amid the development, shares of Zee closed 1.11% up at ₹259.15 on the BSE today. At this share price, the company’s market cap stands at ₹24,935.08 crore.
Yesterday, Zee shares plunged 12.6% after speculations that Sony could withdraw from deal.
"We would also like to state that the Company has always complied with its obligations under the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 and will continue to make disclosures in accordance with the same,” says Zee.
Sony Group is reportedly engaged in discussions regarding the potential merger and the talks are scheduled to persist until January 20, 2023.
Despite previous reports suggesting Sony's consideration of cancelling the deal due to disagreements over the choice of the merged unit's CEO, negotiations on the deal's terms are still in progress. Zee is advocating for its CEO, Punit Goenka, to assume leadership at the combined entity. However, Sony is reportedly hesitant to endorse him due to his recent spats with market regulator SEBI.
The merger agreement between Sony and Zee was signed in 2021, with negotiations initially aimed at concluding by the end of September the following year. In this proposed merger, Sony would hold a majority stake, potentially establishing the combined entity as India's largest broadcaster. While Indian regulators approved the merger in August, Sony reported a delay in September, and in December, Zee requested an extension to the deadline.
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