Zee-Sony merger case adjourned to 9 March

The Mumbai bench of National Company Law Tribunal (NCLT) on Tuesday adjourned hearing on the petitions against the merger of Zee Entertainment Enterprises Ltd with Culver Max Entertainment (earlier Sony Pictures Networks India) to 9 March.

The petitions were filed by Zee’s lenders and creditors IndusInd Bank, Axis Finance Ltd, IDBI Bank and the Indian Performing Right Society (IPRS).

Counsels for Zee said the petitioners were trying to delay the completion of merger. They said the merger had received key regulatory and shareholder approvals, and these applications cannot prevent a merger from taking place.

They said that the scheme has already received approval from 99.97% of shareholders and all secured creditors, besides the Securities and Exchange Board of India (Sebi), stock exchanges, the Competition Commission of India and the official liquidator.

Last year, IndusInd Bank had approached the dedicated bankruptcy court against Zee for an alleged default of ₹89 crore. Later, Axis Finance, a subsidiary of private sector lender Axis Bank, had first moved the Bombay High Court against Essel Group promoter Subhash Chandra and his sons Punit and Amit Goenka, seeking recovery of ₹61.64 crore, and later filed an application in the NCLT.

In December, another financial creditor, IDBI Bank had filed an insolvency application, claiming a default of ₹149 crore.

Its purported claim arises under a debt service reserve agreement entered into by the bank and the company for the financial facility availed by Siti Networks, an Essel group entity.

In January, IPRS filed a petition at the tribunal under the Corporate Insolvency Resolution Process (CIRP), seeking payment of over ₹211.41 crore.

Earlier in December 2021, Zee and Sony had signed a definitive agreement to merge their operations. As part of the proposed merger, the Japanese multinational will own 50.86% stake in the merged entity, while the promoters of Zee will own 3.99% stake. Existing public shareholders in Zee will hold the remaining 45.15% in the merged company. Live Mint