The deal was also approved by the Competition Commission of India (CCI) in October 2022.
The National Company Law Tribunal (NCLT) on Thursday approved the proposed merger of Zee Entertainment Enterprises Ltd with Sony India. This is a key regulatory approval for the mega merger, aimed at creating a $10-billion media giant, which was announced in 2021 but has been delayed for multiple reasons.
The combined entity will include more than 75 TV channels, movie assets and two streaming platforms. The new company will become a major player in the country's fast-growing entertainment industry and could challenge competitors such as Disney's Hotstar.
The merger was initially held up by a courtroom feud between Zee’s founders and its largest shareholder, then subsequently by an insolvency case filed against Zee that was halted in February.
In December 2021, Zee Entertainment and Sony Pictures reached an agreement to combine their businesses. Subsequently, both media companies approached the tribunal to seek approval for the merger, having already obtained necessary permissions from the National Stock Exchange (NSE), Bombay Stock Exchange (BSE), and other regulatory bodies like the Competition Commission of India (CCI) and the Securities and Exchange Board of India (SEBI).
Experts say the deal will benefit various stakeholders, including the companies themselves by enhancing their competitive positions, shareholders through potential increased value, and viewers by potentially offering a broader range of content.
"It's a hugely complementary deal. For example Sony does not have the pan-India, small town and regional reach that Zee has. And Zee does not have a kids or sports business like Sony,"
media and entertainment industry specialist Vanita Kohli Khandekar told the BBC.
The past few years have seen a surge of competition from streaming platforms including Netflix, Amazon Prime Video and Hotstar as many users desert television for digital shows.
Experts say the merger between Sony and Zee is expected to further ratchet up this competition.
Sources: Business Today, BBC
