- The new company will have a market cap of over Rs 70,000 crore

With the merger, the combined revenue will be more than Rs 13,600 crore and the number of employees will be more than 4,000

Mumbai: Entertainment leader Zee and Sony India have merged to form the country's largest entertainment network. In the new company formed after the merger, Sony will have a 5.7 per cent stake and Zen will have a 2.03 per cent stake. Puneet Goenka will continue as MD and CEO of the merged unit. In the merger unit, the promoters of Sony India will have the right to appoint a majority of the board of directors. Most of the directors in the new company will be appointed by Sony. With the merger, the revenue of the new unit will be more than Rs 12,500 crore and the number of employees will be more than 4,000.

As part of the agreement between the two companies, the Zee promoter family has been allowed to increase its existing 2.5 per cent stake in Zee to a new unit and increase it to 20 per cent. Based on current estimates of the equity value of Zee and SPN, the token merger ratio stands at 31.5% in favor of Zee. The new company will have a market cap of over Rs 50,000 crore. Zee's market cap on Wednesday was Rs 2.50 crore.

Following the merger, Sony Pictures Networks India (Sony), a subsidiary of Japanese multinational Sony Corp, has acquired a majority stake in Zee. The peculiarity of this merger is that the shareholders of SPN will raise capital for growth as part of the merger. This amount will be ૫૭૫ 1.6 billion, or Rs 11,412 crore. The new company will have a total of 9 TV channels, two video streaming services (Zee Five and Sony Live) as well as a digital content studio (Studio Next). The company will become an even bigger entertainment company in India than Star and Disney India. This will help the Chandra family to ease the debt burden on the Essel group.

It may be mentioned that Subhash Chandra has been looking for buyers for Zee since 2012. Sony was one of three shortlisted companies with which they were in talks. Negotiations, however, failed due to differences over value. Chandra eventually sold its 11 per cent stake in Zee to Invesco. Thus, Invesco became the largest shareholder in Zee with a share of 12.5 per cent.

Following the news of the merger, Zeno's stock opened at 31.8 against the close of 8.30 on Tuesday and closed at Rs. By making a high surface of Rs. It closed at 8.30. Thus, it had gained Rs 41.10 during the day, an increase of 21.5 per cent. Zee's market cap also rose to Rs 6,050 crore from Rs 8,50 crore in the previous day. Thus, its market cap increased to Rs 8,000 crore in a single day.

- 8,000 crore increase in Zina market cap in a single day: Puneet Goenka to be MD-CEO of new unit

- Sony to bring in new investment of Rs 11,312 crore, Sony to have majority in board

- After the merger, Sony India will have a 6.3 per cent stake in the company and Zine will have a 2.07 per cent stake.

- The new company will have 8 TV channels, two video streaming services as well as a digital content studio.