Hyderabad: Hearing for an emergency arbitration in the Zee Entertainment-Sony merger will take place in Singapore tomorrow, January 31, CNBC-TV18 reported.
Sony Group Corp, the Japanese parent company of Sony Picture Network India (SPNI) and Bangla Entertainment Pvt Ltd (BEPL) announced the termination of the 10 billion dollar agreement with ZEEL as it sought USD 90 million for breach of conditions.
The Singapore International Arbitration Center (SIAC) is the first Asian arbitration institution to offer this process and has received over 130 applications since 2010 for the appointment of an Emergency Arbitrator. In case the application for emergency interim relief is accepted, an Emergency Arbitrator will be appointed within a day.
Zee-Sony merger called off
On January 22, Sony Group Corp announced the termination of the USD 10 billion merger agreement with ZEEL, while seeking USD 90 million for breach of conditions besides initiating arbitration. However, Zee Entertainment has called Sony's demand for $90 million in termination fees legally untenable and has also denied the breach of the merger agreement in response to Sony.
Why was the Zee-Sony merger called off?
According to the Sony Group Corporation (SGC), ZEEL did not stand by the merger conditions despite engaging in discussions to extend the end date for the consummation of the transaction. If the Sony-Zee merger would have worked as discussed, then the combined entity would have owned over 70 TV channels, two video streaming services (ZEE5 and Sony LIV), and two film studios (Zee Studios and Sony Pictures Films India), making it the largest entertainment network in India.
ZEEL MD & CEO Punit Goenka said in a town hall meeting, "Our industry is witnessing rapid changes, and these winds of change are giving us a new shape. We have to mould ourselves to be well-positioned to capitalise on the opportunities coming our way. We have been leaders over the last three decades and have delivered value to our stakeholders, year on year.”
Shares of Zee crashed
Following the termination of the merger by Sony, Zee's stock crashed in the markets. On January 23, the company faced the highest single-day fall of 30.50 per cent and ended at ₹152.50. In the trading session of January 24, Zee's share price partially recovered, to settle at ₹166.35 apiece on the BSE.
