The share price of Zee Entertainment Enterprises Ltd (ZEEL) jumped over 2% in early trading today after the business announced board approval for a merger with Sony Pictures Networks India Pvt Ltd. (SPNI).

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When the merger was announced, Zee stated that SPNI had consented to the appointment of Punit Goenka as MD and CEO of the merged firm and that this was an essential aspect of the agreement.

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On September 22, the two companies announced their merger. Zee and Sony had stated that they will do due diligence for the transaction over a 90-day timeframe. On December 21, the time came to an end.

According to the provisions of the definitive agreements, SPN will have a cash balance of $1.5 billion at closure (assuming an INR to USD ratio of 75:1), including an infusion from SPN’s present shareholders and the promoters of ZEE.

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Under the terms of the non-compete agreement, SPE will pay a non-compete fee to ZEE’s current promoters, which the promoters will use to inject primary equity capital into SPN, entitling them to purchase shares of SPN, which will eventually equal about 2.11% of the shares of the merged entity on a post-closing basis.

Following the merger, SPE will indirectly own 50.86% of the new business, while ZEE promoters would own 3.99%. Existing shareholders will own 45.15% of the merged business.

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The majority of the board of the combined company will be nominated by the Sony Group and will include the current SPNI managing director and CEO NP Singh.

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“It is a significant milestone for all of us, as two leading media and entertainment companies join hands to drive the next era of entertainment filled with immense opportunities. The combined company will create a comprehensive entertainment business, enabling us to serve our consumers with wider content choices across platforms,” said Goenka.

At 09:15 hours Zee was quoting at Rs 356.55, up Rs 7.55, or 2.16% on the BSE.