Sony Zee deal: ZEE-Sony merger wins stock exchange approval

Proposed merger between (ZEE) and Culver Max Entertainmentpreviously Sony Pictures network India (SPN) has been approved by the Bombay Stock Exchange (BSE) and the National Stock Exchange (NSE).

ZEE said in a statement that the approval marks a “firm and positive step” in the overall merger approval process and allows the company to proceed with the next steps in the overall merger process.

Two companies have already applied to the Competition Commission of India (CCI) for approval and will now apply for approval from the National Companies Tribunal (NCLT) and other regulatory approvals.

ZEE and SPN signed a definitive agreement to merge the two companies on December 22 last year.

The proposed merger will see SEA merger with SPN and upon closing, the combined company will be publicly listed in India. Under the terms of the final agreements, SPN will have a cash balance of $1.5 billion (assuming a 75:1 INR/USD ratio) at the time of closure, including an infusion of current SPN shareholders and ZEE promoters .

As part of the non-compete agreement, SPE will pay Rs 1,101.31 crore to the founding promoters of ZEE as a non-compete fee, which will be used by the promoters to inject capital into SPN, which will entitle them to purchase an additional 2.11% stake. the combined company.

After the merger, SPE will own 50.86% of the combined company, while ZEE promoters will own 3.99%. Existing ZEE shareholders will own 45.15% of the shares of the combined company.

Under the agreement, ZEE Managing Director and CEO Punit Goenka will lead the combined company as Managing Director and CEO. The board of directors will include nine directors, five of whom will be appointed by the Sony Group and three will be independent.