Lagatar24 Desk
Mumbai, August 10: The merger of Zee Entertainment Enterprises Ltd. and Culver Max Entertainment (formerly known as Sony Pictures Networks India) was approved by the National Company Law Tribunal (NCLT) on Thursday.
This ruling by the Mumbai bench, presided over by H V Subba Rao and Madhu Sinha, will open the door for the establishment of the largest media firm in the nation, valued at $10 billion.
All merger-related objections were likewise rejected by the tribunal.
After hearing multiple creditors’ objections, the NCLT reserved its decision on the merger on July 11.
Axis Finance, JC Flower Asset Reconstruction Co., IDBI Bank, IMAX Corp. and IDBI Trusteeship were among the creditors that testified.
Zee Entertainment and Sony Pictures decided to merge their companies in December 2021.
After receiving approval from the National Stock Exchange, BSE and sectoral regulators including the Competition Commission of India and the Securities and Exchange Board of India, both media organizations sought the tribunal to request that the merger be approved.
The procedure was put on hold at the tribunal, nevertheless, when a few creditors voiced their disapproval. Several Essel Group creditors objected to the non-compete clause that was included in the scheme.
NSE and BSE had informed the Mumbai bench of NCLT about two orders related to the Essel Group entities, where the promoters allegedly diverted funds from the listed entity for the benefit of their associate entities.
The Securities Appellate Tribunal (SAT) order prohibiting Punit Goenka from holding a directorship in any listed firm was also included in this.
The Securities and Exchange Board of India’s (Sebi) interim ruling prohibiting Zee Entertainment promoters Subhash Chandra and Punit Goenka from serving on the boards of publicly traded firms for a year due to alleged fund diversion was affirmed by the Securities Appellate Tribunal (SAT).
According to the creditors objecting to the merger, the order has a direct bearing as one of the integral parts of the scheme of merger is the appointment of Goenka as the Managing Director of the merged entity.
The merger shouldn’t occur, they argued, as Goenka is prohibited by law from holding such posts.
