What will be the Essel Group stake in Zee after the merger with Sony is completed?

With the terms of the merger of Zee Entertainment and Essel Group already being announced, the next big question is about the residual stake of Essel Group after the merger. Essel Group is the holding company of Subhash Chandra which holds Zee Entertainment. The Essel Group, currently holds 3.44% in Zee Entertainment but this is likely to further get diluted to 2% since Sony shareholders get a larger stake in the merged entity.

However, the Essel Group gets an additional transfer of 2% stake in the merged entity for signing the non-compete agreement. That means, Sony will transfer 2% out of its 52.93% holding in the merged entity to the Essel Holding group. As a result, post the merger, Essel group will hold 4% of the merged entity while Sony group will hold 50.93%. Non-compete payment incentivizes existing promoters not to enter into similar business for a fixed period.