Star India has initiated arbitration proceedings abasing Zee Entertainment for failing to honour the $1.4 billion cricket rights deal, signed by both parties in August 2022.
ZEEL pulled out of the deal for broadcasting ICC men’s and under-19 tournaments after Sony refused to go ahead with their $10 billion merger.
Star India has claimed that Zee is in non-compliance with the terms of the agreement dated August 26, 2022, under the Arbitration Rules of London Court.
Read More: ZEE seeking refund of Rs 69 crore from Star over ICC TV rights agreement violation
ZEEL previously claimed Rs. 69 crore from Walt Disney-owned Star India for violating the ICC TV rights agreement between the two entertainment and media firms.
Zee said in its Q3 financial statements that it has strong grounds to counter Star India’s claims in the ICC TV rights agreement matter. The company added that it has accrued Rs 72.1 crore for bank guarantee commission and interest expenses for its share of bank guarantee and deposit.
Star India had sent letters to Zee alleging a breach of the agreement during the December quarter of FY24 on account of non-payment of dues for the rights concerning the first instalment of the rights fee aggregating to $203.56 million or Rs 1,693.42 crore. This was along with the payment for bank guarantee commission and deposit interest aggregating Rs 17 crore and financial commitments including furnishing of corporate guarantee confirmation as stated in the alliance agreement, Zee said in a document released along with its Q3FY24 results on February 13.
On the other hand, Zee said that Star has not acted as per the agreement and has failed to obtain necessary approvals, and execution of necessary documentation and agreements. The company’s management believes that Star by its conduct has breached the Alliance Agreement and is in default of the terms thereof and consequently, the contract stands repudiated.
Zee said that it has communicated to Star that the alliance agreement cannot be preceded and has sought a refund of Rs 68.54 crore paid to Star.