Back in November 2023, Zee Entertainment Enterprises Limited’s (ZEEL) legal team asked Sony to agree to a ‘hold harmless’ clause for its CEO, Punit Goenka.
A hold harmless clause is essentially a release of liability. If signed, the party agrees to not hold the owner of the business legally responsible for any risks involved in the business.
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Sony was already a little wary of Goenka considering the accusation made on him for financial impropriety by the Securities and Exchange Board of India (SEBI). Sony execs started to question the reason for indemnity.
Goenka was worried that Sony would start a witch hunt against him once the merger was complete, and they had access to Zee’s library of local entertainment content.
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Goenka was unwilling to give up his position as CEO of the merged entity and Sony wasn’t willing to move ahead with him at the helm. As per reports, Sony’s board members met in Tokyo on Jan 19, the deal was kaput. On Jan 22, they sent a 62 page long termination letter to Zee that cited the non-fulfilment of certain pre-requisite conditions that the merger agreement outlined.