Sony Group Corporation (TSE:6758) is continuing talks on a deal to merge its Indian subsidiary with Zee Entertainment Enterprises Limited (NSEI:ZEEL), people involved in the negotiations have said. The talks will continue until Jan. 20, they said Jan.

9, 2024. Sony was earlier reported to have been considering cancelling the deal due to differences over who should be the merged unit's CEO. But talks on terms of the deal are still underway, the sources said.

Zee wants its CEO, Punit Goenka, to take the helm at the merged entity. But Sony no longer wants him in the post because of his alleged misuse of company funds. Because the Securities and Exchange Board of India is investigating the allegations, Sony is thought to be reluctant to accept Goenka as CEO.

Sony and Zee signed a merger agreement in 2021 and began negotiations to wrap it up by the end of September last year. Under the accord, Sony would hold a majority stake in the merged unit, which is expected to become India's biggest broadcaster if the deal goes through. Although Indian regulators approved the merger in August, Sony said in September that there was a delay.

In December, Zee asked Sony to extend the deadline. On Jan. 8, 2024, Bloomberg said Sony was planning to call off the deal.

Sony declined to comment on the report, while Zee said it "is committed to the merger with Sony and is continuing to work towards a successful closure of the proposed merger".