India Regulator Pursues Fund Diversion Allegations Against Zee

India’s market regulator has issued a show-cause notice to Zee Entertainment Enterprises Ltd. and its leadership, reviving allegations of fund diversion and governance lapses that derailed its planned merger Sony Pictures Networks India.

The Mumbai-based broadcaster said it will respond formally to the Securities and Exchange Board of India. The Economic Times earlier reported the notice targets both the company, and its chairman and chief executive officer, following a multi-year probe into Zee’s internal financial dealings.