Zee Entertainment’s Share Price Surges 6% After Proposed Merger Extension

Zee Entertainment's Share Price Surges 6% After Proposed Merger Extension

VoM News Desk | December 21, 2023 | 11:56 AM IST | Breaking News | Follow on Google News

Zee Entertainment’s Share Price Surges 6% After Proposed Merger Extension (Pixabay)

Zee Entertainment’s Share Price Surges 6% After Proposed Merger Extension

Zee Entertainment Enterprises witnessed a 6% surge in its share price during early BSE trading on Thursday, December 21. This uptick comes after the company, in an exchange filing, signaled that it, along with Sony Pictures Entertainment, plans to extend the timeline for their proposed merger.

According to a statement released by Zee, they received communication from Sony Pictures Networks India Private Limited (CMEPL) and Bangla Entertainment Private Limited (BEPL) expressing willingness to engage in discussions regarding the extension of the scheme’s effectiveness period. The merger cooperation agreement (MCA) among Zee, CMEPL, and BEPL necessitates good-faith negotiations to discuss extending the deadline.

The day commenced for Zee with its share price opening at ₹258.45, jumping to a 6% high at ₹266.95, before stabilizing at ₹262.45, marking a 4.23% increase around 9:40 am. Despite this recent surge, Zee’s stock has had a relatively unremarkable performance this year, yielding only about a 5% increase as of the December 20 close, while the Sensex, India’s equity benchmark, has witnessed a gain of approximately 16% during the same period.

In line with earlier reports, facing a deadline to finalize their $10-billion merger, Sony Pictures Entertainment and Zee Entertainment Enterprises have chosen to extend their merger discussion timeline. This development follows their inability to reach a consensus despite prolonged negotiations, regulatory approvals, and substantial spending on merger-related expenses.

The agreement between Sony’s Indian business and Zee Entertainment allows for an additional 30-day extension if either party fails to meet the merger’s terms before the effective date. The effective date for the merger completion has already been extended once previously.

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