Bengaluru, Feb. 1 -- Embattled Zee Entertainment Enterprises Ltd's largest shareholder, ICICI Prudential Mutual Fund, has sold 42% of its holding in the company after Japan's Sony Corp. called off the merger of its Indian entity with Zee, the country's largest media and entertainment company.

ICICI Prudential Mutual Fund, which owned 7.25% in Zee Entertainment as of 31 December, sold 2.15% equity between 20 January and 30 January. It is now the third-largest shareholder in Zee Entertainment, owning 5.09%.

Post this transaction, Nippon Mutual Fund is the largest shareholder in Zee, owning 6.12%, and Life Insurance Corp of India is the second-largest investor, owning 5.12% as of 31 December.

"The fund under its scheme has carried out net...