The merger between Zee Entertainment and Culver Max Entertainment (formerly Sony (NYSE: SONY ) Pictures Networks India) is currently under scrutiny by the National Company Law Appellate Tribunal (NCLAT). The tribunal is hearing appeals from Axis Finance and IDBI Bank, who are challenging the merger. These cases were initially presided over by Justices Anant Bijay Singh and Arun Baroka, but were later transferred due to an insolvency appeal by IDBI Bank against Zee Entertainment Enterprises Limited (ZEEL).
The insolvency plea against ZEEL has led to the cases being moved to a chairperson-led bench at the NCLAT. This shift occurred after Justice Rakesh Kumar resigned amid contempt of court proceedings in the Finolex matter. The NCLAT has allowed ZEEL to respond if necessary.
On the other hand, financial institutions including IDBI Trusteeship, Axis Finance, JC Flowers Asset Reconstruction Co, and Imax Corp have expressed their opposition to the merger. These institutions were not in favor of the merger approved by the Mumbai NCLT branch on August 10, 2023, which resulted in the formation of India's largest media entity.
In related news, ZEEL promoter Punit Goenka received relief from the Securities Appellate Tribunal after it quashed Sebi's order barring him from key managerial roles. Another petition challenging an NCLT order that rejected IDBI's plea to initiate insolvency proceedings against ZEEL is also being heard by the chairperson-led bench.
The legal intricacies of this merger have been complex, with the case being transferred within NCLAT three times within a month. The chairperson is now directing proceedings around IDBI's insolvency plea against ZEEL following Justice Rakesh Kumar's resignation and during Justice Anant Bijay Singh's brief tenure. Axis Finance and IDBI Bank presented their 45-minute arguments opposing the merger, which received a comprehensive dismissal of all objections by the NCLT on August 10.
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