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Tag: NCLT

  • ZEEL equity shareholders give thumbs up to Sony-Zee merger

    ZEEL equity shareholders give thumbs up to Sony-Zee merger

    Mumbai : Zee Entertainment Enterprises Ltd (ZEEL) has announced that the company’s equity shareholders have approved the proposed merger of ZEEL and BangIa Entertainment Pvt. Ltd. with and into Culver Max Entertainment Pvt. Ltd . (formerly Sony Pictures Networks India Pvt. Ltd.)

    The company called the meeting of its equity shareholders on 14 October in accordance with the National Company Law Tribunal (NCLT), Mumbai Bench, order dated 24 August in order to ask for approval for the proposed merger.

    The proposed merger resolution was presented during the meeting, and 99.99 per cent of the equity shareholders of ZEEL enthusiastically endorsed it.

    The company said, “The approval marks yet another firm and positive step forward, in the overall merger completion process.” ZEEL managing director & CEO Punit Goenka will be the managing director and CEO of the amalgamated business.

    After an exclusive negotiation period in which both parties engaged in mutual due diligence was over, Sony Pictures Networks India (SPNI) and ZEEL finalised the merger in December of last year.

    The promoters (founders) of ZEEL will hold 3.99 per cent of the combined company after the transaction closes, while the remaining ZEEL shareholders will hold a 45.15 percent stake. Sony Pictures Entertainment Inc. will indirectly hold a majority of 50.86 per cent of the combined company.

    Through a subsidiary, Sony Pictures Entertainment (SPE) will pay certain Zeel promoters a non-compete fee in accordance with the transactions envisioned by a non-compete agreement. The non-compete fee will be used by these promoters (founders) to provide SPNI with initial equity funding, granting them the opportunity to buy shares in SPNI that, on a post-closing basis, would equal roughly 2.11 percent of the total shares of the combined company.

    Goenka said, “On behalf of all the Board members and management of ZEEL, I would like to thank the equity  shareholders of the company for recognising the value-accretive opportunities the proposed merger will deliver to all stakeholders. The continued trust and overwhelming  support by our equity shareholders towards the resolution of the Composite Scheme of Arrangement, further strengthen our abilities to consistently deliver higher value as we  move forward in this process.”

    The Competition Commission of India (CCI) granted ZEEL permission in a communication dated 4 October. The National Stock Exchange (NSE) and the Bombay Stock Exchange (BSE) have also given the company their approvals for July 2022.

    The Composite Scheme of Arrangement is still pending approval from the relevant authorities and other parties.

  • NCLT seeks shareholder nod for Zeel-Sony merger

    NCLT seeks shareholder nod for Zeel-Sony merger

    Mumbai : Phew! One more hurdle is set to get out of the way to create what could possibly end up being India’s largest media entertainment behemoth with the proposed merger of Zee Entertainment Enterprises Ltd (Zeel)  and Sony Pictures Networks India (SPNI).

    The National Company Law Tribunal’s  (NCLT’s ) Mumbai bench has directed Zeel to convene a virtual shareholder meeting  on 14 October at 4 pm  to get their nod for the merger.

    In July 2022 , Bombay Stock Exchange (BSE) and National Stock Exchange (NSE) gave their approval. But the Competition Commission of India (CCI) has yet to give its approval as it is investigating how the fusion will affect market dominance. The NCLT direction was made last month but Zeel communicated this  to the Bombay stock exchange (BSE) only on 7 September.

    “The ]NCLT  Mumbai bench has directed in its order, that a meeting of the equity shareholders of Zeel be convened and held on Friday, 14 October   for the purpose of considering, and, if thought fit, approving the proposed merger of the company with Culver Max Entertainment Pvt Ltd  (formerly SPNI Pvt Ltd),” read Zee’s statement.

    In July 2022, Zee received approval from the BSE  and the  National Stock Exchange (NSE) for the  proposed merger. According to reports, both the firms  have been in constant contact with the competition watchdog for more than four to five months for getting its nod.

    When the merger plan was announced in September 2021, the two networks said that Sony would invest $1.575 billion and have a 52.93 Per cent  interest in the new firm and Zee the remaining 47.07 per cent.

    Last year, in December, SPNI  and ZEEL signed definitive agreements for the merger following the conclusion of an exclusive negotiation period during which both parties conducted mutual due diligence.

    When the transaction is completed Sony Pictures Entertainment Inc will indirectly control a majority of 50.86 per cent of the combined firm and the promoters (founders) of Zeel  will hold 3.99 per cent, while the remaining Zeel shareholders would hold a 45.15 per cent stake

    Under the terms of the definitive agreements, SPNI, which is an indirect subsidiary of Sony Pictures Entertainment (SPE), will have a cash balance of $1.5 billion (assuming an INR: USD exchange rate of 75:1) at closing, including through infusion by the current shareholders of SPNI and the Zeel promoters, , to enable the combined company to drive sharper content creation across platforms, strengthen its footprint in the rapidly evolving digital ecosystem, bid for media rights in the fast-growing sports landscape and pursue other growth opportunities.

    In accordance with the transactions envisioned by a non-compete agreement, SPE, through a subsidiary, will pay a non-compete fee to certain Zeel promoters.. These promoters (founders) will use the non-compete fee to inject primary equity capital into SPNI, giving them the right to purchase shares of SPNI that, on a post-closing basis, would equal about 2.11 per cent of the total shares of the combined company.

    Zeel CEO Punit Goenka  will serve as the combined company’s managing director and CEO.

    Earlier  Invesco along with OFI Global China Fund LLC, which together hold about a 17.9 per cent  stake in ZEEL, had opposed the deal.

    In March 2022, Invesco had said it would support the Zee-Sony merger deal and had decided not to pursue the call for an EGM of ZEEL to remove Goenka and two independent directors.

    Additionally, Invesco said it would support the Zee and Sony merger, adding that the “deal in its current form has great potential for Zee shareholders,” but added that Invesco retains the right to request a new EGM if the merger is not completed as currently proposed.

    With 75 TV channels and two video streaming services (ZEE5 and Sony LIV), the merged entity will become India’s second-largest entertainment network by revenue. It will also house two film studios — Zee Studios and Sony Pictures Films India and a digital content studio (Studio NXT).

  • Bombay HC allows Invesco plea against order on EGM to remove Zee’s Punit Goenka

    Bombay HC allows Invesco plea against order on EGM to remove Zee’s Punit Goenka

    Mumbai: The Bombay High Court on Tuesday allowed an appeal filed by Invesco Developing Markets Fund, the largest shareholder of Zee Entertainment Enterprises Ltd (Zeel), against a single-judge order granting an interim injunction on holding an EGM to remove Zeel MD and CEO Punit Goenka.

    A division bench of Justices SJ Kathawalla and Milind Jadhav quashed and set aside the single bench order of October 2021.

    “The appeal is allowed. The single bench order is quashed and set aside. We have held that the requisition notice (sent by Invesco to Zee) is neither illegal nor incapable of being set aside,” the court said.

    Senior counsel Aspi Chinoy, appearing for Zee, sought the court to direct for a status quo to be maintained.

    The court then directed for the status quo to be maintained for three weeks.

    The bench also said it has quashed all the observations made by the single bench in its order.

    In September 2021, Invesco had put out a requisition to the Zee board of directors to hold an extraordinary general meeting (EGM) because it felt the company was not running as smoothly as desired.

    The firm sought to remove three directors from Zee’s board, including Goenka.

    When Zee refused to respond to the requisition, Invesco moved an application before the National Company Law Tribunal (NCLT) in Mumbai, which directed Zee to consider the requisition under law.

    Zee then approached the high court, seeking a declaration that the requisition notice by Invesco to hold the EGM was illegal and invalid.

    A single bench of justice Gautam Patel had in October 2021 in an interim order granted an injunction against holding of the EGM.

    Subsequently, Invesco filed an appeal against the interim injunction order on the ground that the high court had no jurisdiction to hear the matter and that it ought to have been heard and decided by the NCLT.

  • Bombay HC grants Zeel temporary relief from Invesco’s EGM notice

    Bombay HC grants Zeel temporary relief from Invesco’s EGM notice

    Mumbai: The Bombay high court has ruled in favour of Zee Entertainment Enterprises Ltd (Zeel) temporarily barring the requisition notice by its majority shareholder Invesco to call for an extraordinary general meeting (EGM).

    In another development, Zeel has also cancelled its board meeting scheduled on 27 October to discuss the unaudited financial results for the second quarter of the year ended 30 September citing lack of quorum. In the BSE filing, the company said that the next date of the meeting will be duly informed with fresh notice.

    “The decision taken by the hon’ble Bombay high court is a huge win for all the stakeholders of the company,” a Zeel spokesperson said in a statement on Tuesday.

    The National Company Law Tribunal (NCLT) hearing on a petition moved by Invesco on the EGM notice will be held on Wednesday. The NCLT is likely to follow the Bombay high court decision.

    The Zeel-Invesco tussle began when the media company’s 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 the company 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, Srinivasa 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 (MIB).

    Zeel refused to conduct the EGM citing ‘shareholders interest’ and moved to Bombay high court on 2 October seeking to declare the requisition notice as “illegal and invalid.”

  • ‘Will safeguard Zee and its future’: Punit Goenka on Zeel-Invesco tussle

    ‘Will safeguard Zee and its future’: Punit Goenka on Zeel-Invesco tussle

    Mumbai: In a new development, Zee Entertainment Enterprises Ltd (Zeel) managing director and chief executive officer has publicly spoken regarding the company’s ongoing boardroom battle with its investor, Invesco Developing Markets Fund.

    “We will ensure that no one maligns the intrinsic value of this company for their own benefit, and I continue to pursue this in the best interest of all our shareholders and at immense personal costs,” stated Goenka.

    Referring to the merger proposal with media business under Reliance Industries in February-March, he wrote that the reason for disclosing the series of communications exchanged between Invesco and the board of directors of Zeel was “to bring the truth out in the interest of all our stakeholders.”

    According to Goenka, the valuation attributed to the media entities under Reliance was inflated by Rs 10,000 crore and as a result, felt that the deal would result in a loss for shareholders of the company.  

    “My attention was on the imbalance observed in the valuation and how it was not in the best interest of our shareholders. The only reason I did not agree to the proposal was that the shareholder value was getting compromised,” he added.

    Goenka acknowledged the stance taken by Invesco but noted that “communications pertaining to such proposals are always well-documented, and they speak to the contrary.”

    On a personal note, he questioned Invesco’s intentions on the basis of their actions and asked pertinent questions, “Why didn’t Invesco make its plans public earlier? Does good corporate governance only apply to corporates and not their institutional investors?”

    He affirmed his faith in the Indian judicial and regulatory system and said that under the guidance of his legal counsel he would take the “required steps to safeguard Zee and its future.”

    The Zeel-Invesco tussle began when the media company’s 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 the company 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, Srinivasa 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 (MIB).

    Zeel refused to conduct the EGM citing ‘shareholders interest,’ and moved to Bombay high court on 2 October seeking to declare the requisition notice as “illegal and invalid.” Meanwhile, Invesco moved a requisition petition with the National Company Law Tribunal (NCLT) to call for an EGM.

    The next Bombay high court hearing is scheduled for 21 October and the next NCLT hearing is scheduled for 22 October.

  • Zee-Invesco tussle: Bombay HC gives Invesco time till 20 Oct to file reply

    Zee-Invesco tussle: Bombay HC gives Invesco time till 20 Oct to file reply

    Mumbai: The Bombay high court on Wednesday heard the petition filed by Zee Entertainment Enterprises Ltd (Zeel) against the requisition notice sent by its investor Invesco Developing Markets Fund. The court has asked Invesco to file its reply by 20 October and will hear the matter on 21 October.

    National Company Law Tribunal (NCLT) has given Zeel time until 22 October to file its reply to Invesco’s requisition plea after a hearing on 8 October.

    Zeel’s 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 the company 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, Srinivasa 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).

    Zeel refused to conduct the EGM citing ‘shareholders interest,’ and moved to Bombay high court on 2 October seeking to declare the requisition notice as ‘illegal and invalid.’

  • 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.’

  • 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: NCLT seeks Zeel’s reply, next hearing on 7 Oct

    Zeel-Invesco Tussle: NCLT seeks Zeel’s reply, next hearing on 7 Oct

    New Delhi: The National Company Law Tribunal (NCLT) has asked Zee Entertainment Enterprises Ltd (Zeel) to file its reply to the petition filed by its investors –  Invesco Developing Markets Fund and OFI Global China Fund IIC and posted the matter for the next hearing on Thursday.

    One of its top investors–Invesco and OFI Global China Fund IIC had approached NCLT last week, after Zeel did not announce the date of an extraordinary general meeting (EGM) as sought by them through a requisition notice sent on 11 September. According to Invesco, the Company is mandated to honour the request of EGM if so demanded by shareholders who own more than 10 per cent of the stake in the Company.

    However, Zeel has not only expressed inability to convene the EGM, but it has also moved the Bombay high court against Invesco’s requisition notice, seeking to declare it “invalid”.

    “As per the decision taken by the Board of the Company, which was communicated on October 1, 2021, and as per their guidance, the Company has already moved to the Bombay high court to declare that the requisition notice sent by Invesco Developing Markets Fund and OFI Global China Fund LLC is invalid,” said the Zeel spokesperson. The Company further maintained that “it will continue to take all the necessary steps that are in the best interest of all its shareholders and as per the applicable law.”

    The investors had called for an EGM of the shareholders seeking removal of its 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.

    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 special 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, it informed the exchange filing that it will not convene the EGM, as the notice is “invalid and illegal.”

  • Zeel-Invesco Tussle: Mandatory for Zeel to call an EGM, Invesco tells NCLT

    Zeel-Invesco Tussle: Mandatory for Zeel to call an EGM, Invesco tells NCLT

    New Delhi: The Boardroom tussle between Zee Entertainment Enterprises Ltd (Zeel) and its top investor Invesco Developing Markets Fund shows no signs of slowing down. On Monday, Invesco argued its case before the National Company Law Tribunal (NCLT) urging the media and entertainment company to schedule an extraordinary general meeting (EGM) as per law.

    Under relevant sections of the Companies Act, it is a mandatory duty of Zeel to honour the request of EGM if so demanded by shareholders who own more than 10 per cent of stake in the Company, said senior advocate Mukul Rohtagi appearing on behalf of Invesco. “The EGM should be called within 21 days,” he emphasised, as reported by moneycontrol.com

    Rohtagi urged the Tribunal to direct Zeel to convene the EGM under the chairmanship of a retired Supreme Court/high court judge, highlighting that it is not concerned about the outcome of the EGM, but about the EGM being called. “It is for the shareholders to decide on the requisition and not them (ZEE) or anybody else,” he told NCLT.

    Last week, Zeel had convened its inability to convene the meeting to the investors. “The Board comprising of experienced professionals deliberated and discussed various legal and statutory implications of the requisition notice. It also sought the opinions of independent counsel, legal experts including retired SC judges, and evaluated the matter in a fair and transparent manner,” Zeel had said in a statement. The Company has now moved the Bombay high court, seeking court’s intervention in declaring the requisition notice as “illegal and invalid”.

    Invesco and OFI Global China Fund IIC together hold an 18 per cent stake in the media company. The investors had sent a special notice to Zeel on 11 September calling for an EGM of the shareholders seeking removal of its 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.

    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).

    The matter is now listed for hearing on Tuesday.