Under the terms of the settlement, none of the parties will have any outstanding or continuing obligations or liabilities to the other.
India's Zee Entertainment Enterprises and Sony's unit in the country have agreed to withdraw all claims against each other related to their failed $10 billion merger, Zee said on Tuesday.
The two companies scrapped the merger in January, in part because Zee failed to meet some financial terms of the deal. Prior to the cancellation, the deal had already received regulatory approvals, including clearance from the Competition Commission of India (CCI), and was to be completed before December 21, 2023.
Zee applied with the India company tribunal to force the deal through but withdrew that to "aggressively pursue" all its claims against Sony in arbitration proceedings at the Singapore International Arbitration Center (SIAC).
The two companies will now withdraw all claims made at the SIAC and at India's national company tribunal, Zee said in a statement.
The company said that neither party will have any continuing obligations or liabilities to one another as part of the non-cash settlement.
Zee's shares surged 13% on Tuesday, but are down about 35% since the merger was terminated in January.
"This is a much needed respite for Zee,"
Elara analyst Karan Taurani said.
The overhang of litigation over the company is now gone, said Shriram Subramanian, founder of InGovern Research Services, a proxy advisory firm in India.
“The settlement stems from a mutual understanding between the companies to independently pursue future growth opportunities with a renewed purpose and focus on the evolving media and entertainment landscape, signifying the definitive conclusion of all disputes,”
the companies said in a statement.
With the settlement, Zee's management is now free to pursue their growth goals, Subramanian said.
Source: Reuters
