In a major legal development, Star India has initiated arbitration proceedings against Zee Entertainment, seeking significant financial compensation over the failed sub-licensing deal for television broadcast rights of ICC events.
As per the details, Star had entered an agreement in 2022 to sublicense the ICC media rights for several tournaments between 2024-27 to Zee for a reported amount of $1.5 billion. However, the transaction did not culminate due to certain contractual issues. Star has now approached the London Court of International Arbitration (LCIA), claiming damages of $940 million (~Rs 8,000 crores) from Zee.
Zee meanwhile has categorically rejected Star's claims for damages, stating that the arbitration is in a preliminary phase. It said the tribunal is yet to determine Zee's liability, and the company will defend itself rigorously against “all unfounded claims”. On the exchange, Zee shares dipped around 1.4% following this disclosure.
Analysts believe the legal battle could be prolonged as neither party seems willing to back down at this stage. The failed deal has also diminished Zee's cricket broadcast prospects and added to its content costs, exerting financial pressures.
Going forward, the arbitration tribunal's final verdict will be keenly watched, as it may have repercussions on the dynamics of the highly lucrative Indian media rights landscape.
