Initially agreeing to have Punit Goenka lead the merged entity, Sony is now reportedly pushing for its own appointee. However, Goenka is holding his ground, and neither side has officially commented on the brewing conflict, a Bloomberg report said.
As per reports, Sony is advocating for NP Singh, the managing director of its Indian operations, to lead the merged company.This push comes in light of an ongoing investigation involving Zee’s candidate, managing director Punit Goenka.
Sony’s change in stance comes in the wake of regulatory challenges faced by Punit Goenka, the son of Zee Group founder Subhash Chandra. Despite being the CEO since 2010, a June 2023 Sebi order jeopardized his position. While he secured a reprieve in the appellate tribunal, the market regulator’s ongoing investigation into alleged fund misappropriation by father and son remains unresolved, with both denying any wrongdoing.
The potential power struggle is critical as it determines who will yield first, potentially forfeiting the opportunity to create India’s largest media company. As per a Motilal Oswal report, the merged entity would boast over 75 television channels and a market share of 37%, surpassing Disney-owned Star’s 24%.
Notably, the Goenka family, with a mere 3.99% shareholding, runs Zee Entertainment. With several institutional investors holding more significant stakes, public shareholders would have the final say if the deal requires fresh approval.
In a separate development, Bloomberg reported last month that Disney, a rival in the industry, is nearing a deal to sell its India operations to Reliance Industries.
Billionaire Mukesh Ambani, having faced rejection in his merger proposal to Goenka in 2021, might be eyeing collaboration with Disney, whose India subscribers are dwindling. If the Zee-Sony deal collapses, expect new alliances and plot twists in this three-year saga, the Bloomberg report said.
(With inputs from agencies)