SAT clears decks for Zee-Sony merger

Goenka reinstated as Zee MD after tribunal overturns Sebi ban

- Priyanka Gawande & Gaurav Laghate

Punit Goenka was reinstated as the managing director and chief executive of Zee Entertainment Enterprises Ltd (ZEEL) on Monday evening after the Securities Appellate Tribunal (SAT) overturned a ban imposed by the market regulator for allegedly siphoning off company funds.

SAT's decision to set aside the 14 August Securities and Exchange Board of India (Sebi) order has also paved the way for Goenka to lead the proposed merged entity of Zee and Sony Pictures Networks India.

The merger was announced in December 2021 but faced delays due to regulatory approvals and objections from financial creditors of Zee promoters. The merger between Zee, a company founded by Goenka's father over three decades ago, and Sony Pictures Networks India (now Culver Max Entertainment) received final approvals from the National Company Law Tribunal (NCLT) on 10 August following the dismissal of objections raised by some lenders, including Axis Finance, JC Flowers Asset Reconstruction Co., IDBI Bank, Imax Corp., and IDBI Trusteeship.

However, in August, Sebi prohibited Goenka from holding key directorship in a listed entity in connection with an alleged fund diversion case. The order, passed by Sebi chief Madhabi Puri Buch, was strongly worded and prevented Goenka and his father, Subhash Chandra, from holding key positions in publicly traded companies until further notice. This led Goenka to challenge Sebi's order before SAT.