An Indian appeals court halted the insolvency proceedings against Zee Entertainment Enterprises Ltd. in a major respite for the media after a local bankruptcy court initiated the process two days back.
(Bloomberg) — An Indian appeals court halted the insolvency proceedings against Zee Entertainment Enterprises Ltd. in a major respite for the media after a local bankruptcy court initiated the process two days back.
The National Company Law Appellate Tribunal, or NCLAT, said on Friday that Zee’s appeal challenging bankruptcy court’s Feb. 22 order requires detailed hearing. The tribunal will hear the case again on March 29.
The NCLAT order comes as a relief for Zee which is closing a merger with a wholly-owned subsidiary of Sony Group to create a $10 billion media giant. The insolvency proceedings, started this week due to a petition from one of Zee’s financial creditors with unpaid dues, threatened to jeopardize the merger as it would have stopped all transactions, including asset transfers.
Zee’s shares rose as much as 3.1% on Friday after an intra-day drop of 14% the day before, data compiled by Bloomberg show.
Sony, Zee Seek to Create $10 Billion Media Giant by End of 2022
Zee remains “committed toward protecting the interests of all stakeholders,” Punit Goenka, Zee’s chief executive officer said in an emailed response. “Our focus continues to be on the timely completion of the proposed merger.”
A lawyer representing Zee told NCLAT that the Sony deal had received all other requisite approvals but would be stalled because of the initiation of corporate insolvency proceedings.
The merger, which has been in the making longer than the timelines originally indicated by Zee, has been approved by Zee’s shareholders and India’s antitrust regulator.
–With assistance from P R Sanjai.
More stories like this are available on bloomberg.com
©2023 Bloomberg L.P.