Major Turnaround: Withdrawn Petitions and Terminated Merger – Zee, Sony Deal Takes a New Turn

Axis Finance, IDBI Bank, and IDBI Trusteeship Services withdrew their appeals against the NCLT order approving the merger of Zee Entertainment with Sony Pictures Networks India. The NCLAT allowed the withdrawal after noting that the NCLT had already recalled its earlier approval. This follows the termination of the merger agreement.

Axis Finance, IDBI Bank, and IDBI Trusteeship Services have officially withdrawn their appeals against the NCLT order that approved the merger between Zee Entertainment and Sony Pictures Networks India.

The National Company Law Appellate Tribunal (NCLAT) permitted the withdrawal, observing that the NCLT had already retracted its August 10, 2023 order endorsing the merger.

According to an NCLAT bench, the appellants sought permission to withdraw their appeals since the merger scheme was already rescinded.

The reversal follows a decision by the Mumbai bench of the NCLT, which had initially approved the merger on August 10, 2023. Subsequently, Zee Entertainment and Sony Pictures Networks India also decided to resolve their six-month-long dispute over the terminated merger, worth USD 10 billion, and agreed to withdraw all claims against each other.

Initially, the merger could have formed a USD 10.5-billion media entity. However, the approval faced opposition from financial entities, including IDBI Trusteeship, IDBI Bank, Axis Finance, JC Flowers Asset Reconstruction Co, and Imax Corp, all of which challenged the order.

Originally agreed upon on December 22, 2021, the merger fell through in January this year when Sony retracted, citing unmet closing conditions by Zee Entertainment.

(With inputs from agencies.)