ZEE Entertainment Enterprises Ltd. (ZEEL) on Friday said that it has received shareholders' approval for the proposed merger with Sony Pictures Networks India Pvt. Ltd, a week after getting clearance from the fair trade regulator Competition Commission of India (CCI). As per the company, 99.99% of equity shareholders approved the proposed merger. The deal is now subject to regulatory and other requisite approvals.

“The company's equity shareholders have approved the proposed merger of ZEEL and BangIa Entertainment Pvt. Ltd. with and into Culver Max Entertainment Pvt. Ltd. (formerly Sony Pictures Networks India Pvt. Ltd.),” ZEEL said in a late evening release on Friday.

The approval marks yet another firm and positive step forward, in the overall merger completion process, the company said.

The company had conducted a meeting of its equity shareholders on October 14 to seek approval for the proposed merger, as per the order of the National Company Law Tribunal (NCLT), Mumbai Bench.

Commenting on the development, Punit Goenka, MD & CEO, ZEE Entertainment Enterprises said, "On behalf of all the Board members and management of ZEEL, I would like to thank the equity shareholders of the company for recognising the value-accretive opportunities the proposed merger will deliver to all stakeholders.”

“The continued trust and overwhelming support by our equity shareholders towards the resolution of the composite scheme of arrangement, further strengthen our abilities to consistently deliver higher value as we move forward in this process," he added.

The proposed merger deal has already received a nod from the Competition Commission of India (CCI) on October 4, 2022. It also got a green signal from the domestic bourses - Bombay Stock Exchange (BSE) and National Stock Exchange (NSE) - in July 2022.

In December last year, Zee Entertainment and Sony Pictures Networks India Private Limited (SPNI) entered into a deal to merge the two entities to create the largest entertainment network in the country. The merger would make the combined entity the largest media conglomerate in India with a 28% share (leaving behind the current market leader, Disney-Star, with a 22% share). The combined entity will include 75 TV channels, two film studios – Zee Studios and Sony Pictures Films India, as well as two video streaming services – ZEE5 and Sony LIV, and digital content studio Studio NXT, which is currently under Sony Pictures Network.

Once the regulatory approvals come through Sony Pictures Entertainment through its Indian entity, SPNI, will indirectly hold a majority of 50.86% of the combined company, the promoters (founders) of ZEEL will hold 3.99%, and the other ZEEL shareholders will hold 45.15% stake. The new board would comprise nine members, out of which five would be nominated by SPNI, three would be independent members and Punit Goenka would also get a position in the board.

Goenka, the incumbent ZEEL CEO, will lead the merged entity as its managing director and CEO. Sony Group will nominate most of the directors on the board of the new entity, including N.P. Singh, the current SPNI managing director and CEO. Post merger, Singh will assume a broader executive position at SPE as Chairman, Sony Pictures India (a division of SPE), reporting to Ravi Ahuja, SPE’s chairman of global television studios and SPE corporate development.

Ahead of the announcement, shares of ZEE Entertainment closed 2.1% lower at ₹267.40 on the Bombay Stock Exchange on Friday. 

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