Japanese conglomerate Sony's India unit has finalised a deal with local rival Zee Entertainment to merge their television channels, film assets and streaming platforms, the companies said on Wednesday.
The combined entity, nearly 51 per cent owned by Sony Pictures Networks India (SPNI), will own popular channels such as Sony MAX and Zee TV, along with streaming platforms ZEE5 and SonyLIV, as part of the deal.
India, still heavy on direct-to-home TV entertainment, has in the past few years seen a surge of competition from streaming platforms including Netflix Inc, Amazon.com Inc's Prime Video and Walt Disney Co's Hotstar.
The companies also approved the appointment of Zee's top boss, Punit Goenka, as the CEO and managing director of the merged entity, after a 90-day due diligence period for the merger closed on December 21.
Zee's shares had rocketed 35 per cent to notch a market capitalisation of nearly Rs 34,017 crore ($4.5 billion) when the merger was first announced in September.
SPNI will have a cash balance of Rs 11,339 crore ($1.5 billion) at the deal close, including through an infusion by current shareholders of SPNI and the promoters of Zee, the companies said.
The deal will also likely ease the pressure that Zee was facing from top shareholders who called for a management reshuffle in September, including for the removal of CEO Punit Goenka from the board, amid corporate governance concerns.
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