Star India Cancels $1.5 billion ICC TV Rights Agreement with Zee

According to a regulatory filing by Zee Entertainment, Star India and Zee Entertainment have ended their collaboration arrangement for the $1.5 billion International Cricket Council (ICC) TV rights as of June 20.

Nonetheless, the broadcaster has chosen to pursue damages—which have not yet been determined—during the arbitration process. On March 14, Star filed an arbitration complaint against Zee with the London Court of International Arbitration (LCIA).

Star and Zee signed an alliance deal on August 26, 2022, under which Star will sublicense the rights to ICC TV for men's and under-19 (U-19) international competitions for four years, until 2027.

Zee's merger agreement with Sony Pictures Networks India failed, hence the company decided not to proceed with the partnership arrangement. Zee would not have been able to serve the ICC TV rights agreement as a stand-alone company.

The business has informed Star that the collaboration deal cannot move forward and has requested a reimbursement of the Rs 69 crore it has already expended.

Zee said that in order to carry out the partnership arrangement, a number of prerequisites had to be met, such as submitting financial commitments, offering bank and corporate guarantees, and waiting for the sub-licensing agreement to receive final ICC approval.

According to the collaboration agreement, Zee has racked up Rs 72.14 crore in commission and interest costs for its portion of bank guarantees and deposits.

Previously, Star had written to Zee through its legal counsel, claiming that Zee had breached the alliance agreement by not paying the first installment of the rights fee, which totaled $203.56 million, as well as the bank guarantee commission and deposit interest, which totaled Rs 17 crore, and other financial obligations, such as providing a corporate guarantee.

Zee has responded to Star by claiming that Star has not followed the terms of the partnership agreement, has not completed the required paperwork and agreements, and has not received the required permissions.

The business further stated that Star has repudiated the contract because of its actions, which have violated the Alliance agreement and caused it to be in default.

Zee believes it has strong and legitimate grounds to defend any claims based on the information at hand and legal counsel. It does not anticipate any materially negative effects regarding the aforementioned, as it believes the contract has been repudiated and the accompanying Statement does not need to be altered.