Zee Entertainment, the Indian media giant, faces a shifting landscape as the founder Subhash Chandra’s family aims to boost their current 4% stake to 26%, as reported by Mint. This development comes in the aftermath of the termination of a $10 billion merger deal with Japan’s Sony, a deal that had been under negotiation for two years.
Sony officially terminated the merger last week and is now seeking $90 million in termination fees from Zee, citing alleged breaches of the agreement’s terms, which Zee vehemently denies.
In an interview with Mint, Subhash Chandra expressed his intention to advise his immediate and extended family to increase their shareholding in Zee gradually. As the chairman emeritus of Zee, Chandra envisions the family’s stake reaching 26%, emphasizing a patient approach to achieve this goal.
Chandra stated, “Yes, we will need a lot of money. But we are clear that we are not going to raise funds from the outside. We don’t want debt.”
The fallout of the Sony-Zee merger is shrouded in mystery, with both parties refraining from specifying the unfulfilled conditions that led to the termination. Notably, a point of contention was Zee’s proposal for its CEO, Punit Goenka, to lead the combined company. This proposition faced resistance, especially after Goenka became the subject of an investigation by India’s market regulator.
Chandra, supporting his son Punit’s capabilities, affirmed to Mint, “Punit is the right person to run the company, and there is no problem with Zee.”
The collapse of the merger coincides with intensified competition in the industry, as notable players like Mukesh Ambani’s Reliance and Walt Disney engage in talks regarding the potential merger of their India media assets. The Zee founder family’s decision to increase their stake indicates a strategic move to navigate the evolving media landscape amid these challenges.
Disclaimer: The events and statements mentioned in this article are based on available reports, and readers are encouraged to verify information from reliable sources.