Sony-Zee merger update: The National Company Law Tribunal's Mumbai bench has issued a notice regarding Zee Entertainment's request to proceed with the merger with Sony Pictures' India arm. The tribunal is set to review the case on March 12, news agency Reuters reported.

Sony Group's India units have filed applications with the NCLT challenging the validity of Zee's application for the merger's implementation.

The NCLT has combined Zee's plea with that of its shareholder, Mad Man Film Ventures, which is considered a proxy for the Indian broadcaster. Mad Man Film Ventures had previously approached NCLT seeking the merger's implementation between Sony and Zee.

Furthermore, the tribunal has also sent notices to Culver Max and Bangla Entertainment, asking them to respond to Zee's application.

Following the NCLT's decision to list the plea, Zee's share prices rose by 1.4 per cent at the time the article was being written.

In August 2023, NCLT's Mumbai bench approved the merger, which was expected to create a Rs 83,000 crore ($10 billion) media entity.

However, Sony terminated the agreement in January due to various delays. Insiders revealed that a lack of consensus on the leadership of the merged entity was among the reasons for the merger's failure.

After the termination of the agreement with Sony Pictures, Zee approached both NCLT and the Singapore International Arbitration Centre (SIAC) in January 2024, seeking the merger's implementation.

Zee urged the tribunal to appoint a panel comprising two directors from each Zee and Sony company to oversee the implementation of the scheme.

The SIAC recently dismissed the plea by Culver Max Entertainment and BEPL, which sought to prevent Zee from approaching NCLT or any corporate dispute tribunal to enforce the merger. However, the SIAC ruled that it lacked jurisdiction.

Responding to the developments, Sony Pictures Entertainment expressed confidence in the matter's merits, stating, "We are disappointed in the decision by the Singapore International Arbitration Centre (SIAC). This decision is only a procedural one, ruling only as to whether Zee Entertainment would be permitted to pursue its application with the NCLT."

Upon terminating the merger agreement, Sony alleged that Zee did not meet the merger conditions and requested Rs 748.5 crore, or $90 million, as a termination fee.

(With Reuters inputs.)