Zee Entertainment Enterprises

History

2024: Termination of merger with Sony due to assets in Russia

On February 1, 2024, it became known that the Japanese corporation Sony broke a $10 billion deal with Indian Zee Entertainment Enterprises Ltd (ZEEL) due to assets in Russia. Despite lengthy negotiations, the parties were unable to resolve the differences that arose.

Sony and ZEEL entered into a preliminary merger agreement in 2021. ZEEL was supposed to be part of Sony's Indian division. The deal could lead to the formation of an Indian TV heavyweight with more than 90 sports, entertainment and news channels. It could compete with the likes of Walt Disney and billionaire Mukesh Ambani's Reliance.

Zee Entertainment

According to Reuters, at the stage of negotiations, Sony and ZEEL accused each other of non-fulfillment of the obligations of the contract. It turned out that ZEEL had assets in Russia (four Russian subsidiaries for the creation and distribution of content), while the preliminary merger agreement contained a ban on the participation in the transaction of structures from countries subject to US sanctions. ZEEL said that the activities of Russian enterprises were terminated in December 2022, but it was not possible to completely get rid of assets due to changes in the legislation of the Russian Federation.

Disagreements between the parties also arose due to the fact that ZEEL in 2022 entered into an agreement to buy from Disney for $1.4 billion broadcast rights India in cricket matches. This caused ZEEL's total debt to exceed the limit set by the agreement with Sony. In addition, the parties could not find common ground on the choice of the CEO of the new combined company. Sony also accused ZEEL of several other violations South Africa of the merger agreement, including the launch of a new TV channel in. As a result, the long-planned deal fell apart.^[1]

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