A game of bluff scuttled Sony-Zee’s plans to create $10 billion media giant

In November, Sony Group Corp.’s lawyers got a nasty surprise during a routine call from the legal team of Zee Enterprises Entertainment Ltd. Nearly two years into tortuous merger negotiations to create a $10 billion Indian entertainment giant, Zee wanted the Japanese company to agree to a so-called “hold harmless” clause for its Chief Executive Officer, Punit Goenka, just weeks before the Dec. 21 deal deadline.

Already wary of Goenka, who had been accused of financial impropriety by India’s markets regulator several months earlier, Sony executives wondered why he requested indemnity.