Zee Entertainment seeks deadline extension for finalising Sony merger deal

While the merger between the two companies received the requisite approvals, differences cropped up over who would helm as the chief executive officer of the merged entity

Zee Entertainment on Sunday sought an extension to complete its proposed merger with Sony India.

The cutoff date for concluding the merger, which will create India’s biggest media conglomerate, is December 21.

While the merger between the two companies received the requisite approvals, differences cropped up over who would helm as the chief executive officer (CEO) of the merged entity.

The Subhash Chandra family, the founders of Zee, have been advocating the appointment of Punit Goenka as the managing director (MD) and CEO of the merged entity.

Sony, however, is wary of Goenka’s appointment since he is under the Securities and Exchange Board of India investigation, according to Bloomberg.

The request by Zee to extend the deadline comes just a day after two independent directors were unable to secure the re-appointment of the company's board.

Sasha Mirchandani and Vivek Mehra “failed to get the requisite majority of votes,” the company said in an exchange filing.

The shares of Zee Entertainment fell 8.9 per cent on Friday before paring losses on speculation around the fate of the deal ahead of the December 21 deadline. 

Just before the AGM, non-executive director Adesh Gupta stepped down citing personal reasons, the company said on Thursday.

Earlier, proxy advisory firm Institutional Investor Advisory Services India (IiAS) asked ZEE shareholders to vote against the reappointment of Mirchandani and Mehra, citing governance issues. 

On Friday, the National Company Law Appellate Tribunal refused to grant a stay to stop the merger following a petition by Axis Finance and IDBI Bank.

The case is now listed for hearing on January 8, 2024.