NCLT approves Sony and Zee’s merger: The birth of a new media giant?

The merger approved by NCLT is poised to give rise to an even bigger entity, with a staggering valuation reaching an impressive $10 billion

The merger, originally scheduled for 2021, necessitated approval from various entities, including the National Stock Exchange (NSE), Bombay Stock Exchange (BSE), the Competition Commission of India (CCI), and the Securities and Exchange Board of India (SEBI), before seeking clearance from The National Company Law Tribunal (NCLT). These sequential regulatory approvals contributed to the postponement of the merger process.

NCLT had previously reserved its decision back on the 10th of July. However, a significant breakthrough has now been achieved as The National Company Law Tribunal (NCLT) granted its approval on 10th August, Thursday. The intricate scheme that forms this merger involves the convergence of two prominent entities: Zee Entertainment Enterprises and Culver Max Entertainment, famously recognised as Sony Pictures Networks India previously.

Through the strategic amalgamation of these two media tycoons, the merger is poised to give rise to an even bigger entity, with a staggering valuation reaching an impressive $10 billion. This can be attributed to the reputation and standing of the companies individually, too, in the world of media and communications. As per sources, their collective market share is projected to soar past 26%, placing it at the top of the country’s TV network hierarchy.

The disclosure of this approval triggered a significant surge in the share value of Zee Entertainment Enterprises Ltd. (ZEEL), propelling it to close at a substantially elevated rate of Rs. 285 on the Bombay Stock Exchange (BSE) yesterday, reassuring investors and companies alike about the merger’s potential.

Having secured the much-awaited approval, the companies are now all set to move to the next phase of the merger, as soon as the upcoming week. While a precise timeline for the climax of this merger seems uncertain still, the insights offered by seasoned mergers and acquisitions (M&A) experts claim that it is expected to conclude by the end of the current year, reports.

(This article is edited by Nishka Modi)