Media firm calls move premature, impulsive
Invesco Developing Markets Fund, a foreign portfolio investor in Zee Entertainment Enterprises (ZEEL) that holds 17.88% in the company, has moved the National Company Law Tribunal (NCLT) in the ongoing tussle with the media firm.
The move comes after ZEEL failed to convene an EGM to seek shareholders’ approval to remove certain directors, including Punit Goenka. At present, Goenka — son of Essel Group founder and chairman Subhash Chandra — is the chief executive & MD at ZEEL. Further, the fund had also sought induction of its nominees on ZEEL’s board.
The petition, which has been listed with the tribunal’s Mumbai bench, is slated to come up for hearing on Thursday.
The company’s spokesperson said: “The board of the company remains committed to act within the framework of law and is focused towards enhancing the company’s growth and shareholder value. It is in the process of taking the required steps within the statutory period. The company does not wish to comment on any impulsive or premature steps taken by Invesco Developing Markets Funds and OFI Global China Fund”.
Invesco (formerly Invesco Oppenheimer Developing Markets Fund) — which holds a 17.88% stake in ZEEL together with its subsidiary OFI Global China Fund — earlier also asked ZEEL to convene an EGM. Apart from the ouster of the directors, whom the fund said were in breach of corporate governance norms, the fund had also sought a reconstitution of the present board.
In its earlier letters, dated September 11 and September 23, Invesco had asked ZEEL to adhere to its fiduciary duties and statutory obligations and convene an EGM. A listed company has to announce an EGM date within three weeks of a request from an investor holding 10% or more stake. In the case of ZEEL failing to announce an EGM date within the stipulated time, Invesco can call for an EGM.
The move followed a board approval by ZEEL for merger of the company with rival Sony Pictures Networks India (SPNI), a subsidiary of Japan’s Sony Corp, to create India’s largest media and entertainment company.