On Monday, Sony ended a two-year process to merge its India subsidiary with Zee Entertainment, creating a $10 billion South Asian media giant.
Sony claimed it handed Zee a termination letter after the Indian corporation failed to satisfy the terms following a 30-day extension. Sony said it was “extremely disappointed” that the Indian corporation failed to honor the arrangement. Zee shares rose 60% in the second half of 2023 on deal optimism. Today is a Maharashtra public holiday; hence, the Indian stock market is closed.
According to sources, Sony Pictures Networks India, the Japanese conglomerate’s Indian branch, wanted Zee’s CEO Punit Goenka to leave the amalgamated business after the deal. After months of resistance, local media suggested last week that Goenka may resign.
Sony wanted Zee to improve its finances, which had worsened in previous quarters. The corporations announced a merger in September 2021. The merger would have established a $10 billion media behemoth in India, where billionaire Mukesh Ambani is expanding his media empire.
Ambani’s Reliance is in advanced discussions to buy 51% of Disney’s India division, which includes Hotstar.
“I resolve to move ahead positively and work towards strengthening Bharat’s pioneering M&E Company for all its stakeholders,” Goenka tweeted Monday, calling the announcement a “sign from the Lord.”
Zee and Sony’s India merger was crucial to their futures in the nation. “The Disney+Reliance merger would create a strong market leader with over 40% TV viewership share and a dominant streaming presence (Disney+Hotstar and JioCinema are India’s two largest OTT platforms by MAU share). Zee and Sony have viewership shares of c16% and c8-10%, respectively, and a united Zee+Sony business, with a c25-30% viewership share, would be better positioned to compete with Reliance + Disney, UBS analysts said earlier this month.
In India, Zee and Sony have been major TV players for 25 years. Since 1995, Sony Entertainment Television India has shown some of the most notable series, including “Indian Idol” and “Kaun Banega Crorepati,” an official Hindi rendition of “Who Wants to Be a Millionaire?”
Zee5 and SonyLiv, on-demand streaming services, compete with dozens of other providers, including Netflix, Amazon Prime Video, Disney’s Hotstar, and Ambani’s JioCinema.
