Sony Pictures Networks India Private Limited (SPNI) and Zee Entertainment Enterprises Ltd. (ZEEL) 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 USD $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.
SPNI is an indirect subsidiary of Sony Pictures Entertainment Inc. (SPE). Under the transactions contemplated by a non-compete agreement, SPE, through a subsidiary, will pay a non-compete fee to certain promoters (founders) of ZEEL, which will be used by such promoters (founders) to infuse primary equity capital into SPNI, entitling the promoters (founders) of ZEEL to acquire shares of SPNI, which would eventually equal approximately 2.11% of the shares of the combined company on a post-closing basis.
After the closing, SPE will indirectly hold a majority 50.86% of the combined company, the promoters (founders) of ZEEL will hold 3.99%, and the other ZEEL shareholders will hold a 45.15% stake.
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.
Commenting on this development, Punit Goenka, MD & CEO, ZEE Entertainment Enterprises Ltd. said, “It is a significant milestone for all of us, as two leading media & entertainment companies join hands to drive the next era of entertainment filled with immense opportunities. The combined company will create a comprehensive entertainment business, enabling us to serve our consumers with wider content choices across platforms. I am immensely grateful to the teams at ZEEL, SPE and SPNI for their efforts, that swiftly led us to this point within the stipulated timelines. This merger presents a significant opportunity to jointly take the businesses to the next level and drive substantial growth in the global arena. I look forward to working with the guidance of the esteemed members of the combined company’s board to unlock the potential of this merger, and I wish N.P. Singh all the best in his new role at SPE. His contribution to the Indian media & entertainment industry has been invaluable. I am most certain that our collective wisdom, rich experience and expertise will lead to a more value accretive and exciting company for our shareholders and employees, and a more engaging one for our customers and partners.”
“Today marks an important step in our efforts to bring together some of the strongest leadership teams, content creators, and film libraries in the media business to create extraordinary entertainment and value for Indian consumers,” said Ravi Ahuja, SPE’s Chairman of Global Television Studios and SPE Corporate Development. “I want to thank Punit and his team at ZEEL and the small army of people at SPE and SPNI who have worked so hard to get us to this point.
HrNxt.com Newsdesk has researchers and writers with an excellent domain knowledge about the talent ecosystem, and the business environment. The team keeps a tab on the latest happenings in the ecosystem to bring most relevant news and insights for our readers. You can connect with our newsdesk at newsdesk@hrnxt.com.