Zee Entertainment says merger with Sony on track
时间:2024-06-26 10:43:58 阅读(143)
Zee Entertainment on Tuesday said that it was committed to its proposed merger with Sony Pictures Networks India amid reports that the deal could be called off by next week. In a statement to the stock exchanges, Zee said it was working towards a successful closure of the proposed $10-billion merger, adding that it would make necessary disclosures with regard to the same.
The statement, which came during market hours, helped arrest the nearly 13% decline seen in Zee’s shares during early trade on the BSE on Tuesday. The stock had tumbled after Bloomberg reported that Japan’s Sony Group Corporation was planning to call off the proposed merger over leadership issues. The deadline for the proposed merger, which is under a one-month extension, will expire on January 20.
Analysts say the deal is crucial to both Sony and Zee’s survival amid the impending merger of Disney Star and the Reliance-backed Viacom18, valued at $12-13 billion.
“We maintain our view that the likelihood of the Sony-Zee merger going through remains high. Zee had said last month that it was entering into good-faith negotiations with Sony for an extension of the merger. They remain committed to closing the deal,” Karan Taurani, senior vice-president, research at brokerage Elara Capital, said.
According to the merger scheme of arrangement, Sony will hold 50.86% stake. Zee promoters (Goenka family) will hold 3.99% and the rest 45.15% stake will remain with public shareholders.
Taurani says that if the merger goes through, the combined entity could be listed by March-April of 2024.
“Regulatory approvals from the Registrar of Companies, ministry of information and broadcasting, and the relisting process will take three to four months. More so, the Zee-Sony combine could stand up in an emerging media landscape where two other groups (RIL-Disney) are looking to come together,” he said.
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- bi, Daiichi Sankyo has said that going ahead with the open offer at this stage would be “illegal”, “an abuse of process of law”, and “gross overreach” of the pending proceedings before the Delhi High Court and also in violation of the orders of the Supreme Court. The market regulator should, therefore, hear it out before taking any call on the IHH’s proposal, it said.
The Japanese pharma major is also filing a plea before the Delhi HC seeking appointment of forensic auditors to analyse transactions involving IHH, Fortis Healthcare and RHT, Singapore, as directed by the HC on October 18.
The development is likely to create legal hurdles and delay the proposed open offer as IHH had recently told FE that it could only go ahead if Sebi agreed with its legal interpretation that the SC’s September 22 order has lifted all such restraints.
IHH managing director and CEO Kelvin Loh told FE on November 9 that the company would like to go ahead with the open offer “as soon as possible” as there has already been a delay of four years. Ravi Rajagopal, chairman of Fortis Healthcare, had added that their legal counsel has advised that the company can go ahead with the open offer as the SC order has disposed of various appeals, including the suo motu contempt. “We have represented to the Sebi and the matter is with them,” Rajagopal had said.
However, legal observers told FE that the matter is not that straightforward and simple as the Delhi HC has to take the final call on the matter of open offer as well as whether a forensic audit has to be done in the share sale which was executed in 2018.
Also Read: IHH to float open offer for Fortis if Sebi concurs with our legal view: MD & CEO
Loh and Rajagopal had said the possibility that the matter may take a different turn when it comes up in Delhi HC cannot be ruled out.
IHH had in July 2018 acquired a 31% stake in Fortis Healthcare for Rs 4,000 crore through the bidding route. It had also earmarked Rs 3,000 crore to make an open offer for an additional 26% to the public shareholders as required under the law.
Daiichi has written to Sebi that the SC in its September 22 order had asked the HC to consider ordering a forensic audit into the dilution of FHL shareholding, repeated violation of undertakings and assurance by former FHL promoters — Malvinder and Shivinder Singh — and the transaction between FHL, IHH and the clandestine transfer of Rs 4,666 crore to RHT Singapore.
Daiichi is “severely prejudiced” with IHH’s clandestine attempt to subvert the status quo order directed by the SC on December 14, 2018, and September 22 with respect to the conduct of forensic audit and the pending proceedings before the HC by purportedly consulting regulatory authorities, including Sebi, on the proposed FHL-IHH transaction. It has reiterated that the FHL-IHH transaction was currently sub-judice before the HC where FHL is also a party, its solicitors, P&A Law Offices, have said in the letter.
“We further state that any such attempt by FHL and/or IHH to proceed with the FHH-IHH transaction would be in direct contravention of the HC and SC orders,” the letter sent by the law firm has stated. Daiichi Sankyo is pursuing the enforcement of Rs 3,500-crore arbitration award against the Singh brothers pronounced by a Singapore tribunal for concealing information when they sold Ranbaxy Laboratories to it for $4.6 billion in 2008. The apex court had in 2018 put on hold the sale of Fortis Healthcare to IHH on a contempt plea filed by the Japanese drugmaker against the Singh brothers.
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