Sony Pictures Announces Merger with Zee Entertainment

Sony Pictures Networks India (SPNI) and Zee Entertainment Enterprises Ltd. (ZEEL) have announced that they have entered into an exclusive, non-binding Term Sheet to combine both companies’ linear networks, digital assets, production operations and program libraries. The non-binding Term Sheet provides an exclusive negotiation period of 90 days during which ZEEL and SPNI will conduct mutual diligence and negotiate definitive, binding agreements. The combined company would be a publicly listed company in India and will reportedly, be better positioned to lead the consumer transition from traditional pay TV into the digital future. The merger of ZEEL and SPNI aims to bring the two Indian media network businesses together, benefitting consumers throughout India across content genres, from film to sports. The combined company is expected to benefit all stakeholders given strong synergies between ZEEL and SPNI.

Under the terms of the nonbinding Term Sheet, Sony Pictures Entertainment, the parent company of SPNI, would invest growth capital so that SPNI has a cash balance of approximately USD $1.575 billion at closing for use to enhance the combined company’s digital platforms across technology and content, ability to bid for broadcasting rights in the fastgrowing sports landscape and pursue other growth opportunities. Sony Pictures Entertainment would hold a majority stake in the combined company. Current ZEEL Managing Director and CEO Punit Goenka is to lead the combined company. The combined company’s board of directors would include directors nominated by Sony Group and result in Sony Group having the right to nominate the majority of the board members. It is anticipated that a final transaction would be subject to completion of customary due diligence, negotiation and execution of definitive binding agreements, and required corporate, regulatory and third party approvals, including ZEEL shareholder vote.