The US investment firm Invesco said on Thursday it would abandon efforts to shake up top management at Zee Entertainment, citing a planned merger between the Indian TV network and the local unit of Japan’s Sony Group, Sony Pictures Networks India (SPNI).
Zee’s shares rocketed 18 percent higher on the news.
Alleging corporate governance issues, Invesco, which owns nearly 18 percent of Zee, had sought the ouster of Zee’s chief executive officer and the appointment of new independent board members. Zee has denied any wrongdoing, Reuters reported.
Although Invesco recently won an Indian court order to call a meeting of Zee shareholders, it said it had decided not to pursue the issue.
“Following the merger’s consummation, the board of the newly combined company will be substantially reconstituted, which will achieve our objective of strengthening board oversight of the company,” Invesco said in a statement.
Zee welcomed Invesco’s decision, saying the Sony merger, which was announced last September, was in the “best interest of all the stakeholders”.
Invesco said, however, it would continue to monitor the progress of the proposed merger and if it failed, it might again seek a Zee shareholder meeting.
Sony did not immediately respond to requests for comment from Reuters.