Sony and Zee were going through a merger whose deadline was supposed to end on 21 January at midnight. However, after Zee failed to file a response, Sony has withdrawn the deal and is not keen to extend it anytime soon. The first official merger request was made in December 2021, and after three years of negotiation, the deal was supposed to be finalised on December 31 2023. Still, just four days before the date, Zee asked for an extension, which Sony granted, entering ‘good faith negotiations’.
Moreover, Sony said that the MD and CEO of ZEEL, Punit Goenka, will not be the CEO of the merged entity until he is cleared of the charges of siphoning money. The Goenka family own around 4% of the ZEEL group; institutional corporations and public shareholders own the rest. However, people close to Sony said that the company is willing to keep Punit Goenka as an advisor for the merged entity. But said that he won’t be a board member until he is freed from the charges of money siphoning.
Sony Group has suggested their India MD and CEO as the chief for the merged entity until Goenka is cleared of the charges. However, many sources had predicted that this would not come through even if Goenka left his position as the CEO. The sources stated that the ZEE group had a very bad financial performance last year; their revenue went down from ₹959 crore in FY22 to ₹ 48 crore in FY23. This would have been the second time companies weren’t able to go through a merger due to financial reasons. The first one happened during the time of the BSNL-MSNL merger which was supposed to take place in April 2022 but fell apart due to financial reasons.
