The $10 billion merger between Indian broadcaster Zee and Japan’s Sony collapsed due to disagreements over a number of issues, including Zee’s deal to acquire Russian assets and cricket rights. This is evidenced by internal correspondence of top managers of the companies examined by the agency. Reuters.
As can be seen from letters sent between December 2023 and January 2024, executive executives of Sony and Zee accused each other of not complying with the terms of the merger. Specifically, in a letter dated January 5, Sony Vice President Eric Moreno said Zee had not cut ties with four Russian subsidiaries involved in content creation and distribution, despite Sony’s request to get rid of assets in sanctioned countries.
In response, Zee lawyer Shyamala Venkatachalam said that the process of divesting Russian assets has not been completed due to changing rules in Russia. At the same time, he assured that the business of these companies will be stopped in December 2022.
Another hurdle, according to the agency, is Zee’s decision to buy the rights to broadcast cricket matches in India in 2022 from Disney for $1.4 billion. Sony said Zee provided $406 million in guarantees for the deal without its approval, which increased the Indian company’s debt beyond what was allowed in the merger agreement.
Representatives of Zee and Sony refused to comment on the situation. The parties negotiated the merger for nearly two years. The merged company will have more than 90 television channels across sports, entertainment and news and will compete with giants like Walt Disney and Reliance.
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Source: Gazeta
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