Sony Pictures Networks India Private Ltd. (“SPNI”), a wholly-owned subsidiary of Sony Group Corporation (“Sony”), announced that it has signed definitive agreements to merge a publicly listed Indian media and content company, Zee Entertainment Enterprises Ltd. (“ZEEL”), with and into SPNI. This follows the conclusion of negotiations of the definitive agreements based on the non-binding term sheet previously announced on September 22, 2021. After the closing of this transaction, the new combined company will be publicly listed in India. Under the terms of the definitive agreements, Sony Pictures Entertainment Inc. (“SPE”), the indirect parent company of SPNI, through SPE’s subsidiaries, will invest approximately 1.06 billion U.S. dollars (assuming an INR:USD exchange rate of 75:1) into SPNI as growth capital at closing for use by the combined company to pursue growth opportunities and will pay a non-compete fee of 147 million U.S. dollars (assuming an INR:USD exchange rate of 75:1) to certain promoters (founders) of ZEEL. As a result of the transaction, Sony will indirectly hold a majority stake of 50.86% in the combined company. The closing of the transaction is subject to certain customary closing conditions, including regulatory, shareholder and third-party approvals.
Sony expects this transaction to close after the end of the fiscal year ending March 31, 2022, and is currently assessing the impact on its consolidated financial results.