Sony looking at acquiring Disney’s India business amidst Zee merger delay: Reports
Discussions between Sony and Disney are seen as part of Sony's contingency strategy, considering the possibility of a prolonged delay or current merger agreement with Zee Entertainment Enterprises Ltd going south.
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Following Blackstone, Gautam Adani, Kalanithi Maran, and the Ambanis, a fresh contender has emerged as a potential buyer for Disney's India business. As per reports, Sony Pictures Entertainment (SPE) is in early-stage talks with Walt Disney Co. regarding a potential acquisition of its India business.
According to a report in Mint, the initial discussions between Sony and Disney are seen as part of Sony's contingency strategy, considering the possibility of a prolonged delay or current merger agreement with Zee Entertainment Enterprises Ltd going south.
Reports suggest that the these discussions with Disney is part of SPE’s plan B.
While the prolonged regulatory challenges in the Zee-Sony deal may have prompted Sony Pictures Entertainment (SPE) to explore other opportunities, the sudden prospect of acquiring Disney’s India business has caught the attention of the global entertainment media company.
On August 14, the Securities and Exchange Board of India (SEBI) accused Goenka of financial irregularities, leading to a delay in the merger. Although NCLAT (National Company Law Appellate Tribunal) has approved the merger, SEBI's investigation into Goenka's activities is expected to take eight months. The same has been challenged by the Goenkas.
Sony, in a recent statement, mentioned that the transaction, originally anticipated to close by the end of the first half of the fiscal year ending on March 31, 2024, is now expected to conclude in the coming months. The company continues to assess the impact of the transaction on its consolidated financial results.
The Disney India saga began with a Wall Street Journal (WSJ) report in July 2023, revealing Disney's active consideration of strategic alternatives for its India business in response to changes in Star India post Disney's acquisition of Fox's entertainment assets. The options being explored include potential joint ventures or a sale of the business. In July, Disney initiated discussions with at least one bank to explore its options.
Following the WSJ report, a CNBC scoop featured Disney CEO Bob Iger hinting at the potential sale of its linear TV assets. Iger acknowledged the challenges faced by the traditional media industry due to the rise of streaming and digital platforms. Although Iger did not specifically mention Disney's India business, the announcement sparked speculations, given the challenges faced by the India business, including a decline in audience and significant exits.
