Mega Zee-Sony merger paves way for $10 billion Indian media giant

India’s company law tribunal approved a merger between Sony Group Corp.’s South Asian unit and Zee Entertainment Enterprises Ltd., helping clear the way for the creation of a media behemoth.

The milestone approval on Thursday brings the deal closer to completion. However, objecting creditors can still appeal the decision at a higher court.

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The merger also needs sign off from India’s Ministry of Information and Broadcasting, Janak Dwarkadas, Zee’s lawyer, told Bloomberg News at the hearing in Mumbai.

Zee’s shares jumped as much as 20 percent after the verdict and closed at their highest level since April 2022.

The deal, aimed at creating a $10 billion Indian media giant, had received the necessary regulatory approvals from the country’s stock exchanges, as well as the antitrust regulator last year.

Acquiring Zee gives Sony access to millions of new viewers and a vast library of local Indian language content that goes back to the 1990s.

The deal faced legal challenges from creditors before the National Company Law Tribunal.

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.

Zee’s founder Subhash Chandra and his son former Chief Executive Officer Punit Goenka remain ousted from holding key positions in the company after the country’s capital market regulator imposed a ban on the duo, alleging that they siphoned off funds.

The pair denied any wrongdoing and have appealed the decision. One of the deal’s requirements was for Goenka to remain managing director and CEO of the merged entity.

Chandra was keen on retaining his family’s influence in the media firm he founded in 1992, though Goenka recently told the Economic Times newspaper that the merger will go ahead even if can’t stay in that position.

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