Two of the biggest names in India's media and entertainment space come together. In a mega-marriage, Zee Entertainment Enterprises Limited (ZEEL) today announced its merger with Sony Pictures Networks India (SPNI). According to the announcement, Sony will invest €1,57 billion and will be the majority shareholder with 52,93% control, while ZEEL shareholders will own 47,07% of the capital. The merger of ZEEL and SPNI would unite India's two leading media network companies, with their content spanning all genres from film to sports. The combined company is expected to benefit all stakeholders given the strong synergies between ZEEL and SPNI. The agreement is subject to the completion of standard due diligence, the negotiation and execution of final binding agreements, and required approvals from companies, regulators and third parties.
What is the real deal?
Essentially, the two companies entered into a non-binding agreement and decided to combine their linear networks, digital assets, production operations, and program libraries. According to the schedule approved for the merger, the two companies will have 90 days to carry out the mutual due diligence and finalize the final agreements. ZEEL's board of directors has approved the deal, and ZEEL's Puneet Goenka will remain the managing director and CEO of the merged entity. ZEEL's board said it "has not only evaluated the financial parameters, but also the strategic value that the partner brings." Zee was facing criticism from investors who last week called for the removal of its three directors. In this case, this fusion will save Zee's face.
What impact will this have on the OTT scene?
Zee and Sony are the biggest names in Indian television and digital space. Zee is available in 173 countries and reaches over 600 million people in India every week. Sony, for its part, reaches more than 700 million viewers in India every week and is present in 167 countries. In total, Sony has 26 channels and Zee 49 channels. Sony's content list covers all genres, but its strength lies in sports. Their broadcast/broadcast of international cricket sports from Australia and England, and the Olympics of late have been huge hits. Zee's forte is in film entertainment and on the issues of TV networks, it has become strong in the South Indian market. With the merger, Sony's network in India will now have access to more than 260.000 hours of Zee's TV content, as well as its movie library with rights to more than 4.800 film titles in multiple languages. "The merged entity will be the number one player in the entertainment space with more than 35-40% of the market share. Of this total, Zee has around 18-19%," a market analyst was quoted as saying by the Economic Times. . India has four main broadcast channels or players: Star, Colors, Zee and Sony. Of these four, two are fused. Therefore, the new entity will certainly be a major player on the global platform as well as in India, he added. But what will happen to the respective OTT platforms of the two companies? Zee5 and SonyLIV. Of course, they'll only make one in the long run. But until the deal goes through mandatory approvals and more clarity emerges in terms of the deals and exchanges between the two companies, it's hard to pin down the details. Both streaming platforms should exist in their current avatar for at least the short term. SonyLIV is currently revamping its app with the help of TCS and also increasing its content from South India. Zee sticks to her Bollywood content while expanding her presence in markets like the United States and Canada. For interesting content, Zee5 has also partnered with players like TVF. "The new entity will bring the combined power of the two entertainment giants to the table," said Ramesh S, an analyst at OTT in Chennai. "But Zee5 and SonyLIV have used their TV muscle on the OTT platform. They're not big like Amazon Prime Video and Netflix. But this merger has the potential to see them compete more head-on," he said. additional. It just so happens that there is going to be a much-needed shakeup in the Indian OTT space.