Sony-Zee’s $10 billion merger gets greenlight

India paved the way on Thursday for a $10 billion media and entertainment powerhouse, giving Zee Entertainment and the Indian unit of Japan’s Sony Group a key merger approval.

Zee’s shares were up 16.6% after the National Company Law Tribunal cleared the long-delayed deal to create a company which will be nearly 51% owned by Sony Pictures Networks India (SPNI) and 3.99% by Zee’s founders.

The Zee Group is among India’s first privately owned television networks and industry executives say the Sony-Zee alliance stands to become the country’s biggest industry player, with significant distribution and advertising muscle.

The combination, which was announced in 2021, hit problems after the Securities and Exchange Board of India banned Zee’s CEO, who had been lined up to run the merged entity, from the boardrooms of listed companies for a year.

Zee later formed an interim committee under the supervision of its board to run operations after Chief Executive Punit Goenka failed to get the ban overturned at appeal.

Goenka told India’s Economic Times in June that the merger would go ahead whether or not he was CEO of the new entity.

In February, an Indian tribunal put on hold insolvency proceedings initiated by lender IndusInd Bank Ltd (INBK.NS) against Zee, in a major relief for the media company. Later, the company settled its dispute with the lender.

Last year, Zee and Sony offered concessions such as pricing discounts to help ease regulatory concerns and received antitrust approval for the merged entity, which will compete with Walt Disney India and billionaire Mukesh Ambani-owned Network18.