On Wednesday ZEE announced its fusion with SONY Network India which will be going to increase the competition in the entertainment sector rapidly.
ZEE Entertainments Enterprises Ltd.(ZEEL) and Sony Pictures Networks India announce their merger as since 2020 we have all were observing ZEE Entertainment's share coming down which is refueling with this deal which is uniting ZEEL and SONY Ltd. This new entity will be India's largest entertainment network followed by Star & Disney partnership which will have about $2billion revenue nearly per year with a 26% viewership share under this new entity.
Both enterprises have entered into non-binding terms and going to make a wide agreement within 90 days.
What this merge means
ZEE has its presence in Broadcasting, Movies, Music, OTT(ZEE5), Digital, and so on with 17% viewership and same as Sony has its wide range of channels with 9% viewership in Entertainment Television and their merger will be a giant in this sector where Sony will own 53% as Zee will leave with 47%.
Currently, ZEE has 96.01% shares in public, while 3.99% is held by its promoters. This new entity will be publicly listed as ZEEL. Sony also proposed to invest $1.575 billion amount to increase the growth of that new entity which will head by the CEO-MD Punit Goenka who led the ZEEL for many years and raised the viewership share by 20% in 2020 from 10% in 2016.
This new entity will go to make things challenging and highly competitive for Stars & Disney integration as well as for other entertainment enterprises too. Things will change for other OTT platforms too. Sony can increase its business in the media industry now to maximize its profit. Zee has been made its profit in such a way that after the announcement of this news on Wednesday ZEE's share closed at 32% up at Rs.337.
ZEE Group's listed companies ZEE media corporation and ZEE education as ZEE learn ltd. both are not included in this merger deal with Sony.
These two are not dealing with each other for the first time as in 2018 ZEE had sold its sports portfolio Ten Sports to Sony Network India. This will be interesting to see how this new entity works now as till now this is just an announcement, the whole agreement is yet to be done.