Zee Seeks $90 Million Termination Fee From Sony Over Failed Merger Deal

New Delhi: Zee Entertainment Enterprises Limited (ZEEL) has demanded a termination fee of USD 90 million (approximately Rs 748.7 crore) from Sony Group. This move comes after the Japanese multinational corporation called off their USD 10 billion merger deal in January 2024.

According to a regulatory filing by ZEEL on Thursday, the termination fees have been sought from two Sony Group entities – Sony Pictures Networks India, now known as Culver Max Entertainment, and Bangla Entertainment (BEPL). The filing states that ZEEL has terminated the Merger Cooperation Agreement (MCA) due to breaches by Culver Max and BEPL, invoking the termination fee clause under the agreement’s provisions.

The filing reads, “Culver Max and BEPL have failed to comply with their obligations under the MCA. Therefore, the company has terminated the MCA and called upon Culver Max and BEPL to pay the termination fee, i.e., the aggregate amount equal to USD 90 million in accordance with the MCA.”

The saga of the failed merger between ZEEL and Sony Group dates back to January 22, 2024, when Sony Group Corporation claimed that ZEEL did not satisfy the merger conditions and initiated arbitration proceedings before the Singapore International Arbitration Centre (SIAC). ZEEL contested this move before the SIAC, which denied any interim relief to the Sony group against the Indian broadcaster.

ZEEL had initially approached the National Company Law Tribunal (NCLT) seeking the implementation of the proposed merger but later withdrew its plea. The Mumbai bench of NCLT had approved the scheme of merger on August 10, 2023, which could have created a USD 10 billion media entity. However, Sony Corporation announced the termination of the agreement two years after the NCLT’s approval.