Sony backs out of $10 billion deal to create media giant in South Asia
Kyiv • UNN
Sony Group has canceled its $10 billion merger deal with Zee Entertainment, which could have potentially created one of the largest television companies in South Asia. Disagreements over who would head the new entity led to the termination of two years of negotiations.
Japan's Sony Group has abandoned a $10 billion deal to merge with Indian media group Zee Entertainment, which could have created one of the largest television companies in South Asia. This was reported by Reuters, according to UNN.
Details
Negotiations on the merger of Sony's Indian unit with Zee lasted two years. The parties were unable to agree on the terms of the deal, namely, who would head the new company.
The Indian side insisted that the company be headed by Zee CEO Punit Goenka. Last year, the Securities and Exchange Board of India banned Goenka from holding directorships in any listed company, accusing him of involvement in financial fraud.
Goenka denied the charges. In October, an Indian court lifted his ban, but said he would have to cooperate with any investigation conducted by the regulator.
The failure of the Zee-Sony merger will disappoint shareholders - this merger could have significantly changed the dynamics of the industry,
Addendum
According to analysts, Zee's four-year deal with Disney's Star for television rights to certain cricket matches is also in jeopardy, with Zee having to pay between $1.32 billion and $1.44 billion over the life of the deal if the deal falls through.