Zee Entertainment signs deal for merger with Sony Pictures India
The Board of Directors of ZEE Entertainment Enterprises
Limited (ZEEL) unanimously provided an in-principle approval for the merger
between Sony Pictures Networks India (SPNI) & ZEEL.SPNI will also infuse growth capital into SPNI
as part of the merger such that SPNI has approximately $1.575 billion at
closing, for pursuing other growth opportunities.Basis
the existing estimated equity values of ZEEL and SPNI, the indicative merger
ratio would have been 61.25% in favour of ZEEL. However, with the proposed
infusion of growth capital into SPNI, the resultant merger ratio is expected to
result in 47.07% of the merged entity being held by ZEEL shareholders and the
remaining 52.93% of the merged entity being held by SPNI shareholders.In a statement, Zee said its board has evaluated
the merger not only on financial parameters, but also on the strategic value
which Sony brings to the table. The board concluded that the merger will be in
the best interest of all the shareholders & stakeholders. The merger is in
line with ZEEL's strategy of achieving higher growth and profitability as a
leading media & entertainment company across South Asia. The board has
authorised the management of ZEEL to initiate the required due diligence
process.The shareholders of Sony
will hold a majority stake in the merged entity. The shareholders of ZEEL &
SPNI have entered into a non-binding term sheet to combine both companies'
linear networks, digital assets, production operations and program libraries.
The term sheet provides an exclusive period of 90 days during
which ZEEL and SPNI will conduct mutual diligence and finalize definitive
agreement. The merged entity will be a publicly listed company in India.
Comments
Post a Comment