The National Company Law Appellate Tribunal (NCLAT) has agreed to hear a plea challenging the merger of Sony Group Corp.’s India unit and Zee Entertainment Enterprises, Moneycontrol reported on December 15.
India’s bankruptcy appellate tribunal has issued a notice in the plea by Axis Finance and IDBI Bank and will hear the matter on January 8, 2024. The appellate tribunal has also sought the responses of ZEEL in the appeals.
According to the Moneycontrol report, at the previous hearing on October 31, the NCLAT transferred the case to a bench led by chairperson Justice (retd) Ashok Bhushan. And, before that on October 12, ZEEL's lawyers Mukul Rohatgi and Arun Kathpalia had requested the tribunal not to pass any orders in the case, alleging that Axis Finance didn't have the locus to file such a plea. They also objected to the adjournment as IDBI's case arose out of a different set of facts.
The latest development comes two weeks after CNBC-TV18 learned from reliable sources that the Zee-Sony merger, which was approved on August 10, is in its final stages.
As per the proposed arrangement, Sony will indirectly possess a 50.86% stake in the merged entity. The founder of Zee will retain approximately 4% ownership, while the remainder will be distributed among other ZEEL shareholders. Additionally, the Sony Group is set to pay a non-compete fee of ₹1,100 crore to the Essel Group promoters.
The next significant milestone is the submission of the merger proposal to the Ministry of Broadcasting, which is Sony's responsibility. Market speculations suggest this step might occur early next week. After the ministry's approval, the formal filing with the Registrar of Companies (RoC) awaits.
This filing requires both the ministry's approval and the already disclosed audited financial figures. Furthermore, a detailed plan for the temporary delisting and subsequent relisting of the stock in its new form is required.
Also, earlier On October 30, the Securities Appellate Tribunal (SAT) lifted the ban imposed by the Securities and Exchange Board of India (SEBI) on Punit Goenka, Zee's former promoter, from holding any key managerial position in the merged entity.
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