Sony Pictures Networks India, Zee Entertainment sign merger agreement

Sony Pictures Networks India Private Limited (SPNI) and Zee Entertainment Enterprises Ltd (ZEEL) on Wednesday announced that they have signed definitive  agreements to merge ZEEL with and into SPNI and combine their linear networks, digital assets, production operations and program libraries. The agreements follow the conclusion of an  exclusive negotiation period during which ZEEL and SPNI conducted mutual due diligence. After closing, the new combined company will be publicly listed in India. The closing of the transaction  is subject to certain customary closing conditions, including regulatory, shareholder, and third party approvals. 

Under the terms of the definitive agreements, SPNI will have cash balance of $1.5 bn at closing, including through infusion by the  current shareholders of SPNI and the promoters (founders) of ZEEL, to enable the combined  company to drive sharper content creation across platforms, strengthen its footprint in the  rapidly evolving digital ecosystem, bid for media rights in the fast-growing sports landscape and  pursue other growth opportunities.  

Punit Goenka will lead the combined company as its managing director & CEO. The majority  of the board of directors of the combined company will be nominated by the Sony Group and will include the current SPNI Managing Director and CEO,  N P Singh. On closing, Singh will  assume a broader executive position at SPE as chairman, Sony Pictures India (a division of SPE) reporting to Ravi Ahuja, SPE’s chairman of Global Television Studios and SPE Corporate  Development.  

While SPNI will own a 50.86 per cent stake in the merged entity, Zee’s founders will own 3.99 per cent, according to an exchange filing from Zee. The remaining 45.15 per cent will be with public shareholders as part of the definitive agreement. 

The combination of ZEEL and SPNI is expected to achieve business synergies and given their  relative strengths in scripted, factual and sports programming, respective distribution footprints  across India and iconic entertainment brands, the combined company should be well-positioned  to meet the growing consumer demand for premium content across entertainment touchpoints and platforms.