Sony says no extension of merger deadline yet – Times of India

MUMBAI: Sony’s India unit said it is looking to hear Zee’s proposals for completing the merger with the company. Sony Pictures Networks India, the local unit of the Japanese media conglomerate, said on Tuesday that it “has not yet agreed to a deadline extension” as requested by Zee on Sunday.
It further said that the request to extend the deadline itself “is an acknowledgement that they will not be able to close the merger” of the two companies by the December 21 deadline.
Inked on December 21, 2021, the Zee-Sony merger, which would create a $10-billion media and entertainment powerhouse, has been facing several obstacles, primarily due to legal cases against Zee and its promoters, the Goenka family.
The merger agreement allows Zee and Sony to extend the deadline thrice. But, if Sony decides against it, then it will have to pay a termination fee of $100 million to Zee.
Sony said: “The notice (from Zee) triggers an existing contractual provision in the deal that allows for both parties to discuss the possibility of extending the deadline.” It added that it is “required to start those conversations” but has not yet agreed to prolong the merger deadline.
The review of the deal comes at a time when Walt Disney is planning to merge its India unit with Reliance Industries’ Viacom18.
Though the Zee-Sony merger has received regulatory and shareholder nods, it still needs the approvals of the ministry of information and broadcasting (MIB) and the registrar of companies.
For the MIB clearance, Sony needs to submit the names of the directors that will occupy the board of the merged entity. But, with Zee MD Punit Goenka facing a regulatory probe, it is not able to submit the list.
The merger agreement allows Sony to nominate the majority of the board members on the combined entity, while Zee has the right to appoint Goenka as MD of the new company.
Markets regulator Sebi is conducting an investigation against Geonka and Zee in a securities law violation case. A final order is expected to come out in this matter.
Because of the legal troubles, Sony has been pitching its India head, N P Singh, as MD of the new entity. However, Goenka has not accepted this suggestion.

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