Zee Entertainment Enterprises Ltd and Sony Pictures Networks India have decided to terminate all their disputes arising from their failed $10-billion merger.

The two companies have decided to drop all their compensation claims against one another as they draw the curtains on a protracted saga that started with the announcement of their merger in December 2021 and was winding down since Sony terminated the deal in January 2024.

This was also the period during which Reliance Industries and Paramount have announced their merger to create a media and entertainment behemoth. The merger is now doing the rounds of regulatory approvals.

The Zee stock jumped 12 per cent on Tuesday.

As part of the “comprehensive non-cash settlement” between Zee and Culver Max Entertainment Pvt Ltd (CMEPL), both “have mutually agreed to withdraw all respective claims against each other, in the ongoing arbitration at the SIAC and all related legal proceedings initiated in the NCLT and other forums,” said a joint statement.

“The companies will also withdraw the respective Composite Schemes of Arrangement from the NCLT and inform the relevant regulatory authorities,” it said.

Both Zee and Sony had claimed a termination fee of $90 million (around ₹748.7 crore) from each other for not complying with the merger cooperation agreement (MCA).

Sony had moved before the Singapore International Arbitration Center (SIAC) immediately two days after the termination of the deal, saying Zee did not satisfy the merger conditions, initiated arbitration proceedings and claimed a termination fee of $90 million.

This was contested by Zee before the SIAC, which denied any interim relief to the Sony group against the Indian broadcaster.

Zee also moved the National Company Law Tribunal (NCLT) seeking implementation of the proposed merger and later withdrew its plea.

Later in May, Zee terminated MCA by issuing a letter dated May 23, 2024, and it also sought a termination fee of $90 million from two Sony Group entities — Sony Pictures Networks India (SPNI), now known as Culver Max Entertainment, and Bangla Entertainment (BEPL).

Under the settlement terms, none of the parties will have any “outstanding or continuing obligations or liabilities” to the other, the joint statement said.

“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 & entertainment landscape, signifying the definitive conclusion of all disputes,” it said.

The overhang of litigation over the company is now gone, Shriram Subramanian, founder of InGovern Research Services, a proxy advisory firm in India, told Reuters.

With the settlement, Zee’s management is now free to pursue their growth goals, Subramanian said.