ZEEL clarified in its statement that there are no expected financial implications on the company that may arise as a result of the petition, except legal costs.

Invesco Developing Markets Fund and OFI Global China Fund LLC, which together own a 17.88% stake in ZEEL, on 11 September 2021 served a notice to ZEEL to hold an EGM to remove Punit Goenka from the firm's board as director.

Goenka, son of Essel Group founder and chairman Subhash Chandra, is managing director and chief executive officer of ZEEL.

The two institutional investors also called for the removal of two of ZEEL's independent directors, Ashok Kurien and Manish Chokhani. The letter also proposed the appointment of six independent directors, including Surendra Singh Sirohi, Naina Krishna Murthy, Rohan Dhamija, Aruna Sharma, Srinivasa Rao Addepalli and Gaurav Mehta.

On 13 September, ZEEL informed that Chokhani and Kurien resigned as non-executive non-independent directors.

ZEEL held the 39th annual general meeting of the equity shareholders on 14 September 2021. The AGM did not discuss the notice sent by its largest shareholder, seeking an EGM of shareholders to remove Punit Goenka from the board.

Meanwhile, on 21 September 2021, ZEEL's board approved the merger between the firm and Sony Pictures Networks India (SPNI). ZEEL and SPNI have entered into a non-binding term sheet to combine both companies' linear networks, digital assets, production operations and program libraries.

The term sheet provides an exclusive period of 90 days during which ZEEL and SPNI will conduct mutual diligence and finalize definitive agreements. The merged entity will be a publicly listed company in India.

The shareholders of SPNI, will hold a majority stake in the merged entity. The shareholders of SPNI will also infuse growth capital into SPNI as part of the merger such that SPNI has approximately $1.575 billion at closing, for use in pursuing other growth opportunities.

The merger ratio is expected to result in 47.07% of the merged entity to be held by ZEEL shareholders and the balance 52.93% of the merged entity will be held by SPNI shareholders.

As part of the transaction, Punit Goenka will continue to be the managing director and CEO of the merged entity. However, majority of the board of directors of the merged entity will be nominated by Sony Group.

Further, certain non-compete arrangements will be agreed upon between the promoters of ZEEL and the promoters of SPNI. According to the term sheet, the promoter family is free to increase its shareholding from the current 4% to up to 20%, in a manner that is in accordance with applicable law.

ZEEL is a media and entertainment company engaged in providing broadcasting services. On a consolidated basis, ZEEL posted a net profit of Rs 213.8 crore in Q1 FY22, steeply higher than net profit of Rs 30.37 crore in Q1 FY21. Net sales increased 35% to Rs 1775 crore in Q1 FY22 from Rs 1312 crore posted in Q1 FY21.