GECs
Sony-Time Warner battle for MGM intensifies
MUMBAI: The battle over the acquisition of MGM between Sony and Time Warner is heating up.
While at this point Time Warner appears to be ahead, Sony CFO Katsumi Ihara has reiterated that the company needs to buy MGM to expand its own film unit.
In an interview to Bloomberg, Ihara said that acquiring MGM would boost Sony’s movie unit, giving it an expanded movie library and rights to films in development. It was in April that Sony had expressed its interest in buying MGM.
A recent report in the Wall Street Journal had stated that while Sony, Texas Pacific Group and Providence Equity Partners are negotiating to buy MGM for almost $5 billion, Time Warner has offered $4.6 billion in cash.
Another report in imdb.com said that if MGM goes to Time Warner then it will greatly facilitate the making of The Lord Of The Rings prequel The Hobbit by LOTR director Peter Jackson and Time Warner division New Line Cinema. The movie rights to The Hobbit are held currently by MGM.
This year Sony’s biggest hit has been Spider-Man 2 which has earned $740 million worldwide. MGM’s library consists of over 4,000 films which include the James Bond flicks. In India, MGM has a JV with Zee for the channel Zee MGM.
If the deal were to go through in favour of Sony, it would give the Japanese company a chance to increase brand recognition in the US beyond its core electronics business. Sony will then probably fold MGM into its Sony Pictures Entertainment division.
At the moment Sony’s movie business accounts for less than 10 per cent of its total revenue. An MGM acquisition would no doubt change that ratio.
GECs
Sebi sends show-cause notice to Zee over fund diversion, company responds
Regulator questions 2018 letter of comfort and governance lapses; company vows robust legal response
MUMBAI: India’s markets watchdog has reignited its long-running scrutiny of Zee Entertainment Enterprises, issuing a sweeping show-cause notice that drags the broadcaster and 84 others into a widening governance storm.
The notice, dated February 12, has been served by the Securities and Exchange Board of India to Zee, chairman emeritus Subhash Chandra and managing director and chief executive Punit Goenka, among others. At its heart: allegations that company funds were indirectly routed to settle liabilities of entities linked to the Essel Group.
The regulator’s probe traces its roots to November 2019, when two independent directors resigned from Zee’s board, flagging concerns over the alleged appropriation of fixed deposits by Yes Bank. The deposits were reportedly adjusted against loans extended to Essel Group entities, triggering questions about related-party dealings and board oversight.
A key flashpoint is a letter of comfort dated September 4, 2018, issued by Subhash Chandra in his dual capacity as chairman of Zee and the Essel Group. The document, linked to credit facilities availed by certain group companies from Yes Bank, was allegedly known only to select members of management and not disclosed to the full board—an omission SEBI believes raises red flags over transparency and governance controls.
Zee has pushed back hard. In a statement, the company said it “strongly refutes” the allegations against it and its board members and will file a detailed response. It expressed confidence that SEBI would conduct a fair review and signalled readiness to pursue all legal remedies to protect shareholder interests.
The notice marks the latest twist in a saga that has shadowed the broadcaster since 2019. What began as boardroom unease has morphed into a full-blown regulatory confrontation. The final reckoning now rests with SEBI—but the reputational stakes for Zee, and the message for India Inc on governance discipline, could scarcely be higher.
