By Kosaku Narioka

Sony Group Corp.'s Indian unit and Zee Entertainment Enterprises Ltd. said Wednesday that they agreed to merge in a bid to meet growing consumer demand for entertainment content and drive shareholder value.

Sony Group will indirectly hold a 51% stake in the combined company while founders of Zee will have a 4% interest and other Zee shareholders will own a 45% interest, the companies said. The combined company will be publicly listed in India, they said.

Zee Chief Executive Punit Goenka will lead the combined company as CEO, while the majority of the board of directors will be nominated by Sony Group, they said.

The combined company will have a cash balance of $1.5 billion at closing, including infusion by Sony and Zee founders, they said.

The closing of the transaction is subject to regulatory and shareholder approvals, they said.

Sony Group's Indian unit, Sony Pictures Networks India, and Zee said in September they began talks for a potential merger.

Write to Kosaku Narioka at kosaku.narioka@wsj.com

(END) Dow Jones Newswires

12-21-21 2304ET