Mumbai After a seven-month-long legal dispute with the founders of Zee Entertainment Enterprises Ltd over control of India’s largest publicly traded media company, the broadcaster’s largest shareholder Invesco Developing Market Funds has signed the firm through a block deal. decided to sell 7.8% of Rs. on Thursday.
After the sale, Invesco will have about 11% of Zee left. Invesco to sell 74 million shares 2,200 crore through block deals in the range of 270-290 per share, as per the terms of the deal as seen by the Mint. Kotak Mahindra Capital will manage the stake sale.
Zee shares fall 3.03% 290.95 on Wednesday. The announcement was made after the trading was over in Mumbai.
“The objective of this transaction is to align the fund’s exposure to Zee with other funds managed by the investment team and achieve a total ownership position in the company that is in line with the investment team’s portfolio building approach,” Invesco said. Statement.
“Upon completion of the bookbuild, funds managed by Invesco’s Developing Markets investment team, including the Invesco Developing Markets Fund, will continue to own at least 11% of Zee’s total, underscoring the investment team’s belief that the Sony deal will continue to hold its own.” The current form has great potential for Zee shareholders,” it added.
The development comes less than two weeks after Invesco withdrew its demand for a special shareholders’ meeting, which it called for the removal of Zee managing director Puneet Goenka since September, and a reshuffle of the board.
On 23 March, Invesco said it had decided not to change Zee’s board and instead supported Zee’s proposed merger with Sony Pictures Networks India Pvt. Ltd.
“We believe that this deal in its current form holds great potential for Zee shareholders. We also believe that, post-merger, the board of the newly combined company will be substantially restructured, which will strengthen the company’s board oversight. will achieve our objective of doing so,” Invesco said.
Invesco’s decision came after the Bombay High Court ruled in its favour, upholding the demand for funds for the shareholders’ meeting.
The US investor had earlier expressed concerns about how the current board and managing director Goenka, son of founder Subhash Chandra, has run the company. Chandra holds 3.99% stake in Zee.
In September, just before Zee’s annual general meeting, Invesco asked the company to hold a special meeting of shareholders and vote on its recommendations for the removal of Goenka and the induction of six independent directors.
After Zee rejected the demands for the fund, Invesco approached the National Company Law Tribunal (NCLT) in Mumbai, which directed Zee to consider the demand. Zee then approached the High Court, seeking to declare that the demand letter by Invesco for conducting the EGM was illegal and invalid.
In October, Invesco revealed that it had facilitated merger talks between Zee and Reliance Industries, which failed because the fund did not support Goenka and his family to increase their stake in the company.
This revelation comes after Zee signed a non-binding deal for a merger with Sony.
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