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Tag: NCLAT

  • Sapphire Media wins BIG 92.7 FM; gets favourable order from NCLAT

    Sapphire Media wins BIG 92.7 FM; gets favourable order from NCLAT

    MUMBAI: It’s a big – actually Big 92.7 FM –  win for Haryana-outdoor firm and Indian Daily TV channel  owner Sapphire Media. It has got a favorable order from the National Company Law Appellate Tribunal (NCLAT) for it to acquire the Reliance Broadcast Network run radio network Big FM 92.7.

    The principal bench of the NCLAT, Delhi on Monday dismissed the plea filed by Radio Mirchi, Orange FM and others against the NCLT judgement which approved the resolution plan of Sapphire Media for Big 92.7 FM.

    The NCLAT Bench comprising chairperson  justice Ashok Bhushan and (technical) member Barun Mitra in its order today said that “in view of the foregoing discussions and conclusions, we do not find any ground to interfere in the order of NCLT dated 06.05.2024 impugned in the above appeals. In result, all the appeals are dismissed.”

    Earlier, the NCLT bench comprising technical member Madhu Sinha and judicial member Reeta Kohli had approved the resolution plan submitted by Sapphire Media in its order dated 6 May  2024. As per the plan, Sapphire Media would  pay Rs 261 crore to secured and operational creditors against the total claims of Rs 947.5 crore.

    The resolution professional subsequently filed an application with NCLT Mumbai seeking approval of Sapphire Media’s resolution plan.

    Big FM 92.7 FM , owned by Reliance Broadcast Network, has been going through the insolvency process since February 2023.. It is the country’s largest radio network with 58 stations and a reach of over 1,200 towns and 50,000+ villages will reinforce Sapphire Media’s aggressive expansions plans in the media space.

    Sapphire Media is promoted by Aditya Vashistha and Kaithal-based businessman Sahil Mangla. Sapphire media runs a national Hindi news channel in name of India Daily and is one of the biggest outdoor advertising companies in India.

  • Axis Finance moves to NCLAT – more noise, no impact

    Axis Finance moves to NCLAT – more noise, no impact

    Mumbai: Axis Finance has approached the National Company Law Appellate Tribunal (NCLAT), Delhi against the National Company Law Tribunal (NCLT) order approving the merger of Zee and Sony. The NCLAT has served notice to Zee in response to Axis Finance’s plea.

    We believe the above issue of Axis Finance approaching the National Company Law Appellate Tribunal (NCLAT) will not have any impact on the merger between Zee and Sony because the claims being pursued by Axis Finance, which amount to Rs 1,000 mn, are not directed at Zee but rather at its parent company, Essel Group. As mentioned in the NCLT merger order (Zee/Sony), Axis Finance has previously approached various legal bodies, including the Debt Recovery Tribunal (DRT) and high courts, for above claims; however, judgements on the same have not been in their favour (Axis Finance). Therefore, we believe these claims lack merit and will not impact the merger. Also, appeals with NCLAT may continue for months even after the merged company is formed, just like in the case of PVR-Inox merger (Consumer Unity & Trust Society appealed in NCLAT against the merger and the case got dismissed in August 2023 – six months after the merged company of PVRINOX was formed).

    As for the current status of the merger, the merged company is progressing with the Registrar of Companies (ROC) filing process, post receipt of the NCLT merger order. They are also engaged in discussions regarding Closing Precedents (CP) (the merged company may want to include July/August financials as well), which may result in a delay of two to three weeks in the merger timeline. We believe the record date is usually given one week prior to delisting. Considering the marginal delay in CP, the record date for the merger could be towards the last week of October 2023. Subsequently, relisting is expected to take place in the first or second week of December 2023 vs our earlier expectation of the second week of November 2023. Additionally, the company will need to submit details of the merged co. Board of Directors to the Ministry of Information & Broadcasting (MIB), before the record date is finalised.

    Further, the SEBI/SAT issue (with promoters) too may not impact the merger timelines as the NCLT merger approval is without any condition.

    We have a BUY recommendation on Zee with a 24 Sept TP of Rs 340 – we maintain our positive stance on the company; PFA our latest company update post the NCLT merger approval.

    The credit of this article goes to Elara Capital SVP Karan Taurani.

     

  • NCLAT dismisses Amazon’s appeal against suspension of transaction with Future Group

    NCLAT dismisses Amazon’s appeal against suspension of transaction with Future Group

    MUMBAI: The National Company Law Appellate Tribunal (NCLAT) has dismissed Amazon’s appeal against the suspension of transaction with Future Group, and upheld the Rs 200 crore penalty imposed by the Competition Commission of India (CCI). It has directed the US-based e-commerce major to pay the amount within 45 days. Amazon can challenge the NCLAT order in the Supreme Court.

    Last week, the NCLT adjourned the hearing of Amazon’s petition opposing the initiation of insolvency proceedings against debt-ridden Future Retail during a virtual hearing in the matter.

    Earlier, this year in January, US giant Amazon Holdings NV had moved the NCLAT against the CCI. Its case is against CCI’s 17 December where the anti-trust watchdog had suspended and revoked its approval for the deal with Future Group alleging misrepresentation.

    As per the anti-trust watchdog’s 17 December order, Amazon was fined Rs 202 crore by CCI for allegedly misrepresenting and suppressing information while seeking regulatory approval in 2019 to buy a stake in Future Group.

    The move followed a Delhi High Court judgement on 5 January that suspended Amazon’s arbitration proceedings in Singapore against estranged partner Future Group for contract violations, giving the debt-ridden Indian retailer a reprieve.

    The high court had pushed the arbitration proceedings owing to the CCI order. As per the CCI’s 57-page order, it said that the approval for the Amazon -Future deal would be kept in abeyance.

  • Former SC judge Ashok Bhushan appointed as NCLAT chairperson

    Former SC judge Ashok Bhushan appointed as NCLAT chairperson

    Mumbai: The central government on Friday appointed retired Supreme Court judge Ashok Bhushan as chairperson of the National Company Law Appellate Tribunal (NCLAT).

    The post of NCLAT chairperson has been vacant since March 2020. Justice Bhushan has been given a term of four years or until he attains the age of 70 years, whichever is the earliest.

    He has been associated with several landmark judgments, including Ram Mandir, Covid-19 management, and registration of migrant workers.

    The central government has also approved the appointment of Justice Ramalingam Sudhakar as the president of the National Company Law Tribunal (NCLT) for five years or till he attains the age of 67 years, whichever is the earliest.

    Sudhakar was former chief justice of Manipur high court.

  • NCLT gives Zeel time till 22 Oct to file reply to Invesco plea

    NCLT gives Zeel time till 22 Oct to file reply to Invesco plea

    Mumbai: The National Company Law Tribunal (NCLT) on Friday gave Zee Entertainment Enterprises Ltd (Zeel) time till 22 October to file its reply to a plea by its shareholder, according to a report by PTI. The decision was taken after the company approached National Company Law Appellate Tribunal (NCLAT) which declared that ‘reasonable and sufficient opportunity’ should be given to Zeel to respond to the investor’s plea.

    Zeel had approached the appellate body challenging the NCLT order dated 5 October which asked the company to submit its reply to the investor’s demand for calling an extraordinary general meeting (EGM) by Thursday.

    The NCLT hearing had been deferred to Friday after the NCLAT reserved its order on the plea until later in the evening on Thursday.

    Zeel two top investors Invesco Developing Markets Fund and OFI Global China Fund LLC who combined own 18 per cent stake in the company had sent a requisition notice to Zeel on 11 September to call an EGM even after two weeks, the investors moved to NCLT, citing provisions of Company Law, according to which the company is bound to call for an EGM within a specific number of days, if stakeholder demanding it owns more than 10 per cent of the company.

    The investors had also sought the removal of long-standing directors and close associates of the Chandra family from the board. The two independent directors Ashok Kurien and Manish Chokhani have already submitted their resignations.  

    The investors moved to have six nominees appointed to the board of Zeel, which included Surendra Singh Sirohi, Naina Krishna Murthy, Rohan Dhamija, Aruna Sharma, Srnivasa Rao Addepali and Gaurav Mehta as independent directors of the board for a term up to five consecutive years. The notice was received by Zeel on 12 September, and it informed the stock exchanges on 13 September, adding that the appointments are subject to approval by the ministry of information and broadcasting (I&B).

    Last week, Zeel refused to conduct the EGM citing ‘shareholders interest,’ and moved to Bombay high court seeking to declare the requisition notice as ‘illegal and invalid.’

  • Zeel must get ‘reasonable time’ to reply to investors plea: NCLAT passes order

    Zeel must get ‘reasonable time’ to reply to investors plea: NCLAT passes order

    New Delhi: Zee Entertainment Enterprises Ltd (Zeel) should be given a “reasonable and sufficient opportunity” time to respond to the investors’ plea filed before the National Company Law Tribunal (NCLT), said the National Company Law Appellate Tribunal (NCLAT) on Thursday.

    Zeel had approached the Appellate authority, challenging NCLT’s order which asked the Company to submit its reply to the investors’ demand for calling an extraordinary general meeting (EGM) by Thursday, when its next hearing was scheduled.

    The appellate tribunal stated that NCLT had made an “error” by not granting Zeel “reasonable and sufficient time for filing a reply…. This was a complete violation of NCLT Rules and Principles of Natural Justice,” said the two-member bench of the NCLAT and asked NCLT to proceed after hearing both parties. “We are of the opinion that reasonable and sufficient opportunity should be given to the appellants for filing a reply.”

    The Appellate Tribunal also mentioned that “Section 98 of the Companies Act does not prescribe any limit and limitation on the learned NCLT to pass order within that time limit.” However, it did not mention the amount of time that should be granted to the media conglomerate. 

    Meanwhile, NCLT had deferred the hearing of the Zeel-Invesco case to Friday, citing the plea pending before the NCLAT.

    Zeel spokesperson said that the company continues to have full faith in the Indian judicial system and will take all the necessary steps that are in the best interests of all its shareholders.  

    Zeel’s top two investors Invesco Developing Markets Fund and OFI Global China Fund LLC who together hold an 18 per cent stake had sent a requisition notice to Zeel on 11 September to call an EGM and discuss the removal of MD Punit Goenka. When Zeel did not announce the date of the EGM even after two weeks, the investors moved NCLT, citing provisions of the Company Law, according to which the Company is bound to call an EGM within a specific number of days, if the stakeholder demanding it owns more than 10 per cent stake in the Company.

    The investors had also sought the removal of long-standing directors and close associates of the Chandra family from the Board. The two independent directors Ashok Kurien and Manish Chokhani have already submitted their resignations.

    The investors had also sought the appointment of their own six nominees on the board of Zeel, which included Surendra Singh Sirohi, Naina Krishna Murthy, Rohan Dhamija, Aruna Sharma, Srinivasa Rao Addepalli, Gaurav Mehta as independent directors on the board for a term of up to five consecutive years. The notice was received by Zeel on 12 September, and it informed the stock exchanges on 13 September, adding that the appointments are subject to the approval of the ministry of information and broadcasting (I&B).

    Last week, Zeel Board refused to conduct the extraordinary general meeting (EGM) citing ‘shareholders interest’, and moved the Bombay high court seeking to declare the requisition notice as “illegal and invalid”.

  • NCLAT reserves orders on Zeel’s appeal

    NCLAT reserves orders on Zeel’s appeal

    Mumbai: The National Company Law Appellate Tribunal (NCLAT) on Thursday reserved orders on an appeal moved by Zee Entertainment Enterprises Ltd (Zeel). The company had challenged the 5 October order by the National Company Law Tribunal (NCLT) on the matter of requisition for an Extraordinary General Meeting (EGM). The requisition notice was moved by top investors at Zeel including Invesco Developing Markets Fund and OFI Global China Fund IIC. 

    Meanwhile, the NCLT which was slated to take up the application for an EGM on Thursday at 2:30 p.m, has decided to adjourn the hearing until 2:30 p.m on Friday after hearing that NCLAT had reserved its order.

    On 5 October, the NCLT had given Zeel two days to file its counter-affidavit to the applications before it. The bench had declined to give more time to file this response opining that it was a simple matter that did not need weeks for a reply to be filed. This order was challenged by Zeel before the NCLAT.

    The NCLAT bench has informed that the order on Zeel’s appeal would be pronounced and issued later on Thursday. The bench said that they would not be deciding the case on merits, but would peruse all NCLT orders passed in the matter to take a call on Zeel’s appeal, according to a report by Bar and Bench.

    Counsel for Zeel argued that the case before NCLT was only at an interim stage and was converted into a final hearing without giving the company suitable time to respond. Counsel for Invesco argued that there was no distinction between interim relief and final relief in the present case and that “the appeal should be rejected at all costs as it is an abuse of process of court,” according to Bar and Bench.

    Zeel’s boardroom tussle began on 11 September, when the company’s top two investors – Invesco and OFI China Fund IIC which together hold an 18 per cent stake in the media company, sent it a requisition notice calling for an EGM of shareholders. The investors sought the removal of Zee’s sitting managing director Punit Goenka and two independent directors Ashok Kurien and Manish Chokhani. The two independent directors had submitted their resignations a day prior. The investors had also sought the appointment of their own six nominees on the board of Zeel.

    Zeel had challenged the requisition notice stating that it is “invalid and illegal” and had moved to the NCLAT for a hearing.

  • Zeel-Invesco Tussle: After Bombay HC, Zeel now approaches NCLAT

    Zeel-Invesco Tussle: After Bombay HC, Zeel now approaches NCLAT

    New Delhi: Media and entertainment giant Zee Entertainment Enterprises Ltd (Zeel) has now approached the National Company Law Appellate Tribunal (NCLAT) against the order passed by National Company Law Tribunal (NCLT) on Tuesday. The Tribunal had asked the Company to submit its response to the investors demand for calling an extraordinary general meeting (EGM).

    “The Company has moved to National Company Law Appellate Tribunal (NCLAT) in accordance with the due process available under the law,” said ZEEL spokesperson.  The next hearing in the NCLT is on Thursday.

    The development comes few days after Zeel filed a petition in the Bombay high court seeking to declare the requisition notice sent by Invesco Developing Markets Fund and OFI Global China Fund LLC as “invalid”. “The Company continues to have full faith in the Indian judicial system and will take all the necessary steps that are in the best interests of all its shareholders,” the statement added.

    The Zeel boardroom tussle began on 11 September, when the Company’s top two investors- Invesco and OFI Global China Fund IIC which together hold an 18 per cent stake in the media company sent it a requisition notice calling for an EGM of the shareholders. The investors have sought the removal of Zeel’s sitting MD Punit Goenka, and long-standing directors and close associates of the Chandra family from the Board. The two independent directors Ashok Kurien and Manish Chokhani had submitted their resignations a day prior. Meanwhile, the

    The investors had also sought the appointment of their own six nominees on the board of Zeel, which included Surendra Singh Sirohi, Naina Krishna Murthy, Rohan Dhamija, Aruna Sharma, Srinivasa Rao Addepalli, Gaurav Mehta as independent directors on the board for a term of up to five consecutive years. The notice was received by Zeel on 12 September, and it informed the stock exchanges on 13 September, adding that the appointments are subject to the approval of the ministry of information and broadcasting (I&B).

    However, Zeel refused to conduct the extraordinary general meeting (EGM), stating that the requisition notice was “illegal and invalid”. The Company further maintained that it will continue to take all the actions needed in the interest of the shareholders as per law. “The Board has arrived at this decision by referring to various non-compliances under multiple laws, including the Securities and Exchange Board of India guidelines, ministry of information and broadcasting guidelines, and key clauses under the Companies Act, and Competition Act, and after taking into account the interest of all the stakeholders of the company,” Zeel had said in a statement.

    Meanwhile, on September 22, ZEEL also announced its proposed merger with Sony Pictures Networks India (SPNI) which will create the country’s largest media company. The merged entity, in which SPNI’s parent company SPNI would infuse $1.575 billion, will be a public listed company in India. Punit Goenka was announced as the CEO and managing director of the new entity, with the promoter family being free to increase its holding from four per cent to 20 per cent over time.