 "Zee Ent slips 4% as it seeks to extend deadline for merger with Sony")
Shares of Zee Entertainment Enterprises declined 3.9 per cent to Rs 266 apiece on the BSE in Monday's intraday trade after the company, on Sunday, sought an extension to complete its proposed merger with Sony India.
The request to extend the deadline comes just a day after two independent directors were unable to secure the re-appointment of the company's board. The cutoff date for concluding the merger is December 21.
"Pursuant to the Merger Cooperation Agreement dated December 22, 2021, entered into amongst the Company, Bangla Entertainment Private Limited (BEPL), and Culver Max Entertainment Private Limited (CMEPL), the Company has requested CMEPL, and BEPL to extend the date required to make the Scheme effective, as per the terms of the Merger Cooperation Agreement," ZEEL said in an exchange filing on Sunday, December 17.
While the merger between the two companies received the requisite approvals, differences cropped up over who would helm as the chief executive officer (CEO) of the merged entity.
The Subhash Chandra family, the founders of Zee, have been advocating the appointment of Punit Goenka as the managing director (MD) and CEO of the merged entity.
Sony, however, is wary of Goenka's appointment since he is under the Securities and Exchange Board of India investigation, according to Bloomberg. READ MORE
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Meanwhile, on Friday, the National Company Law Appellate Tribunal refused to grant a stay to stop the merger following a petition by Axis Finance and IDBI Bank.
The case is now listed for hearing on January 8, 2024.
Financially, Zee Entertainment Enterprises reported 9 per cent rise in consolidated net profit at Rs 123 crore for the quarter ended September 30, 2023, as strong demand for its movies and a pickup in subscriptions eclipsed a decline in advertisement revenues.
It reported consolidated net profit of Rs 113 crore in the year-ago period.
Its total income rose 23 per cent to Rs 2,510 crore in Q2FY24 as against Rs 2,040 crore in Q2FY23. The firm's revenue rose 20 per cent to Rs 2,438 crore in Q2FY24 as compared to Rs 2,024 crore in Q2FY23.