Zee-Sony Merger Cancelled: Sony Group Issues Termination Letter, Demands ₹748 Crores Termination Fee from Zee
Sony Group has officially called off its merger with Zee Entertainment Enterprises (ZEE). The merger, initially signed in 2021 between Sony Pictures Networks India (now Culver Max Entertainment Limited) and ZEE, has been terminated by Culver Max and Bangla Entertainment Pvt Ltd, which resulted in a termination fee demand of $90 million (approximately Rs. 748 crores) from ZEE.
In response, ZEE has denied Sony’s claims and stated that its board of directors is assessing all available options. The company is considering taking appropriate legal action against Sony. The termination letter from Sony Group marks a significant development in the business dealings between the two entertainment entities.
The prolonged negotiations spanning two years have ended in frustration as Sony officially declared the termination of the merger with Zee Entertainment Enterprises. Sony expressed disappointment over the failure to reach a merger agreement by the January 21 deadline, despite extensive discussions over the past two years. The company remains dedicated to expanding its presence in the rapidly growing Indian market and delivering top-notch entertainment to the local audience.
A Bloomberg report indicates that the original agreement in 2021 designated Punit Goenka as the CEO of the new entity resulting from the merger. However, due to regulatory scrutiny, Sony later objected to Goenka assuming the role of CEO. Punit Goenka, the son of Zee Group founder Subhash Chandra, currently serves as the Chief Executive Officer of Zee.
The merger between Zee and Sony Pictures Networks India was initially announced in 2021. However, the merger faced obstacles, including objections from creditors and various other reasons, ultimately preventing its completion. The proposed merger aimed to create a company with an estimated value of $10 billion (approximately ₹83,000 crores). If successful, the combined entity, with over 24% viewership, would have become the largest entertainment network in the country, leveraging the strengths of both Zee and Sony.
