Zee Entertainment Enterprises Ltd. has reportedly agreed to repay its dues owed to IndusInd Bank Ltd. as the company seeks to resolve insolvency proceedings initiated against it and move closer to completing a merger with a Sony Group unit. The repayment of about 837 million rupees ($10 million) to IndusInd Bank could happen as early as Friday, according to sources familiar with the matter who requested anonymity as the information is not public.
IndusInd Bank had approached the bankruptcy court in February, seeking to start insolvency proceedings against Zee, a move that could have potentially threatened the merger by stopping all transactions, including asset transfers. However, last month, the National Company Law Appellate Tribunal, an appeals court, halted the insolvency proceedings against the media company.
The withdrawal of the insolvency proceedings against Zee will reportedly occur once the repayment is made, paving the way for the completion of the merger. The merger, which is expected to create a $10 billion media giant, has been in the making for longer than originally anticipated by Zee. The deal has been approved by Zee’s shareholders and India’s antitrust regulator, but its progress has been impeded by the initiation of corporate insolvency proceedings.
Representatives for Zee Entertainment and IndusInd Bank have not commented on the matter. A lawyer representing Zee previously told NCLAT that the Sony deal had received all necessary approvals but would be stalled because of the initiation of corporate insolvency proceedings.
The repayment of dues to IndusInd Bank is seen as a positive development in the resolution of Zee’s insolvency proceedings and will likely boost investor confidence in the company’s ability to manage its debts. The successful completion of the merger with Sony would create a major player in the media industry and could potentially lead to more mergers and acquisitions in the sector.