Japanese conglomerate Sony has abandoned its merger with Indian media group Zee Entertainment. The agreement between the companies was signed back in 2021.
Sony announced the termination of the merger agreement in a press release on January 22. According to the Financial Times, the parties were unable to resolve differences over the issue of whether Punit Goenka would retain the position of director of Zeen. The Japanese company insisted on his resignation from his management position once the agreement was closed.
Business publication sources involved in the negotiations said Sony was concerned about the Indian regulator’s investigation into Goenka. He is suspected of fraud.
Other Financial Times interlocutors close to Zee’s position described Goenka’s removal from the CEO position at such a late stage as legally difficult. Such a move would mean a violation of the merger agreement.
Consequently, the Japanese company expressed its extreme disappointment at the unsatisfactory terms of the merger. However, Sony will not give up on increasing its presence in India.
The Financial Times estimates that the merger could create a company valued at $10 billion.
Author:
Natalia Gormaleva
Source: RB
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