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Tag: Zeel

  • ZEEL CMO Prathyusha Agarwal on niche channels in NTO, regional portfolio and subscription growth

    ZEEL CMO Prathyusha Agarwal on niche channels in NTO, regional portfolio and subscription growth

    MUMBAI: Zee Entertainment Enterprises Ltd (ZEEL) CMO Prathyusha Agarwal believes that the new tariff order (NTO) was TRAI’s best move for the industry as it has opened one more way to monetise apart from advertising. Now, subscription revenues count too. Post NTO, Zee’s subscription revenue has grown by 46 per cent in the last quarter.

    Agarwal says that there was a popular belief that niche channels would suffer the most with the implementation of NTO but there was a subscription uptake. She said, “Contrary to popular belief the subscription uptake was great. We see it as an opportunity now that there will be subscription numbers available, which will be in millions.”

    She further says, “So, if an advertiser is trying to reach out to premium audiences or English-consuming audiences, they know that these are the millions of people available, and what kind of consumption they are indulging in as well. So I think that NTO is a good move for niche channels. Of course, at first, the last mile was giving the idea that English channels are only available in higher-priced packs and such things. But we campaigned for the English cluster and that’s our focus even today. That's a great way to go for a niche channel and even for the advertiser, as this is where they have audiences who have consciously purchased you and you can reach out through advertising.”

    Agarwal goes on to say that in tier 2 cities, English content is available only through TV channels and Zee’s aim is to serve them curated content. “Our single-minded focus for the English cluster is about getting great quality, exclusive content and making it available first on TV,” she says. 

    There is bound to be some pricing variable since this is happening for the first time. “The NTO move has been contrary to all popular belief; pay channels have grown in reach. So there's been a 5 per cent growth at all India level and 10 per cent growth at an HSM-level for pay GECs. From Q1 FY 19 to Q1 FY 20 there is also been a 1.5 per cent increase in total TV viewership,” she reveals.

    “Last quarter, we had a 46 per cent growth in subscription revenues thanks to our strong regional channel brands as well. For example in Zee Marathi and Zee Bangla, our share is more than number two and number three put together. We've had that kind of pull in the market and hence the ease of transition was faster for us,” she adds. Agarwal says that where the channel number dropped from 50 to 40, the quality of consumption has improved.

    Even though NTO took a toll on several companies’ finances, Agarwal says that there was a larger economic downturn as well. People held on to the money to invest for festive time, which is the later part of the year. That is taking place now.

    She goes on to state that the 30 per cent of Zee viewers has converted to 80 per cent. While people knew they wanted Zee channels, the network eased the process and friction.

    Recently, TRAI released a consultation paper to review NTO stating that broadcasters have been misusing the new rule. On this, Agarwal says that people are only getting accustomed to the new climate. “I don't think anybody is trying to misuse. When you get a variable for the first time, it will take a while before market dynamics and the feedback loop happens. I would actually say that the entire sector needs to come together and ensure demand pricing stabilises. The current journey is more of a learning journey and it happens in any category where pricing is just about to start,” she adds.

    Zee will continue to build culturally deep-seated content and original hours in every region. But the single-minded focus across channels is to drive demand lead subscriptions. “I think there's no better way than consumers asking for your channels and ensuring that we are available, easily accessible and delivering value. Going ahead, the roadmap will strongly drive the behaviour of evolving purchase and subscription and that's what will drive our subscription revenues.”

    As clients want to speak to the different regions of India, she says, “We will focus to do more and maybe expand the portfolio in the regional. We will add more and more offerings to speak to the many Indias.”

  • ZEEL promoters pledge 10.71% shareholding with Russia’s VTB Capital

    ZEEL promoters pledge 10.71% shareholding with Russia’s VTB Capital

    MUMBAI:  Zee Entertainment Enterprise Ltd’s (ZEEL) promoter Essel Group pledged 10.71 per cent shareholding in the media company with Russia’s VTB Capital Plc.

    According to a disclosure made by VTB Capital to the stock exchanges, the encumbrance on 10.2 crore shares of Zee owned by Essel Media Ventures Ltd was created pursuant to a loan agreement executed on 4 September 2017.

    As per Sebi’s new rules related to pledging which came into effect on 1 October, disclosure of detailed reasons for encumbrance if the shares pledged equal or exceed 50 per cent of the total promoter holding (including shares owned by persons acting in concert) or 20 per cent of the total share capital of the company is needed.

    As of 30 June 2019, the promoters were holding about 35.79 per cent of the company. Subhash Chandra-led Essel Group has been working to sell assets due to high debt crisis. Essel Group agreed to sell up to 11 per cent stake for Rs 4,224 crore in Zee to Invesco Oppenheimer to repay lenders back in August.

  • Zee Bangla’s Samrat Ghosh on economy slowdown, NTO & consumption trends in Bangla market

    Zee Bangla’s Samrat Ghosh on economy slowdown, NTO & consumption trends in Bangla market

    MUMBAI: Zee Entertainment Enterprises Ltd’s regional channel Zee Bangla recently completed 20 years of its journey in the Bangla market. The mantra of consumer-centricity has kept the channel in the leading position in the market. Going farther in its journey, the channel wants to be known as a brand which is relevant, relatable and embedded into Bengali values and culture. While speaking to Indiantelevision.com, ZEEL cluster business head- East Samrat Ghosh spoke on the journey of channel, evolution of content in the Bangla market, consumption trends, impact of economy slowdown and advertisement on the channel.

    He believes that the Bangla TV industry is on a growth path. In the last 20 years, the original hour of content offering has increased by almost 2.5X – 3X. In terms of growth and advertisement on the channel, Ghosh informed that post NTO the subscription revenue has over delivered and there has also been a healthy growth in its top line.

    Approximately 20 per cent of the overall ad revenue on the channel is from local advertisers and the number is expected to increase during the festival season. “There is a purchase cycle which happens during festival season and Durga puja being one of them, we see local advertisers advertising more to get the reach. We are hoping to surpass last year numbers even after the challenging scenario of economy slow down in the market. In our case, we are expecting a healthier growth and better than last year’s number.”

    Ghosh also said that the television is the less impacted medium in the current economy slowdown scenario and Zee Bangla doesn’t see any impact on its ad revenue. Explaining further he said, “It all depends on how you reach out to your consumers. For example, sectors like FMCG, automobiles, consumer durables etc., always requires a platform to reach out to the target audience. Television being the highest penetrated medium in the country, the impact of economy slowdown on television is not that huge compared to the other medium. In Bengal, we are the highest penetrated platform in the market and therefore the dependability of the advertisers on Zee Bangla is quite high.”

    Explaining how the channel will work on viewership, he said, “There are some factors which will attribute for bringing back the reach- one is the brand pull and second is how aggressively we are marketing the product to the consumer. It’s an ongoing journey. Mostly the migration that I have seen in the market post-NTO is around 87 to 88 per cent, so there is a gap of ten to twelve per cent of migration which is yet to happen.”

    Compared to overall TV penetration in the country, Bengal is lower than the national average. TV penetration in all India is 66 per cent and in West Bengal it is 60 per cent. “One out of three TV audience of West Bengal is from AB Segment (AB:CDE – 33:67) and this ratio is way behind national ratio (47:53), especially in the rural market (23:77), opined Ghosh.

    “In other markets, a lot of content is telecast in the morning and afternoon bands and some of them also offer original content in the afternoon. But in Bangla market, primarily with regards to the GECs, there is no offering of original content in the afternoon. Mostly the focus is towards primetime,” said Ghosh.

    Viewers in Bangla market watch 19 hours of TV content in a week. They consume only 53 per cent Bengali content, mostly Bengali GEC content (43 per cent) followed by Hindi movies (16 per cent). 63 per cent of Bengali viewership consumption happens in primetime (16:30 – 24:00). In the morning their preference is news, movies in the noon and GEC in the evening. Most of these viewers (52 per cent) are of 30 years+ and they contribute 57 per cent of time spent.

    For the industry to grow, Ghosh said that there is a need for new actors and writers. “Currently, this seems to be a challenge. However, since last year Zee Bangla has initiated a project under the name ‘Yes Bangla’ to find and nurture new sets of actors and writers. Another challenge is staying relevant to audiences in an environment of growing digital traction. Next challenge is that the total reach of the market is yet to come back vis-a-vis pre-NTO regime.”

    “Through our programmes and campaigns, we have encouraged our viewers to move ahead and chase their goals by unshackling their inner fears and in the journey taking the entire family together. The reflection of the same will be captured in all our future shows as well.  To celebrate these unique 20 years, Zee Bangla is also launching an in-house annualised magazine ‘Sonar Songshar’,” said Ghosh.

    Zee Bangla was launched in September 1999 earlier in the name of Alpha Bangla and over the last 20 years, the channel has offered various fictions, non-fiction shows and premiere blockbuster movies. In 2018, it had refreshed its brand philosophy to ‘Notun Chhonde Likhbo Jibon’ which means ‘Let’s orchestrate life in a new rhythm’.

  • ZEE Entertainment stake stale’s first tranche worth 8.7% completed by Essel Group

    ZEE Entertainment stake stale’s first tranche worth 8.7% completed by Essel Group

    MUMBAI: Multi-faceted business conglomerate Essel Group on Tuesday announced the successful completion of the first tranche of ZEE Entertainment Enterprises Limited's (ZEEL) stake sale to Invesco Oppenheimer Developing Markets Fund.

    On 31 July 2019, the group had entered into an agreement to sell up to 11 per cent promoter stake in ZEEL to the fund.

    The Subhash Chandra-led Group has now completed the sale of 8.7 per cent stake in ZEEL as part of the first tranche. 

    Essel is confident of  completing the balance sale of 2.3 per cent stake over the next few days.

    The company is working towards the timely completion of operational formalities in order to conclude the entire transaction at the earliest.

    This development reaffirms the media and entertainment giant’s positive progress on its overall asset divestment approach undertaken, to generate adequate liquidity for the repayment process. 

    The group is also working actively on further divestments including its non-media assets and remains confident to complete the same.

  • ZEEL acquires balance 26% equity stake in Zee Network Distribution

    ZEEL acquires balance 26% equity stake in Zee Network Distribution

    MUMBAI: Zee Entertainment Enterprises Ltd (ZEEL) has acquired the balance 26 per cent equity stake in Zee Network Distribution Ltd. The company informed the Bombay Stock Exchange about the development in a letter.

    “In this regard, we wish to inform you that, upon completion of all conditions precedent including inter alia change of name of the subsidiary after removing the word 'Turner' to Zee Network Distribution Ltd, the company has concluded the said acquisition and accordingly, Zee Network Distribution Ltd has now become a wholly-owned subsidiary on and from 9 August 2019,” the company said in it.

    Zee Network Distribution Ltd was incorporated on 20 December 2001 as a joint venture entity between ZEEL and Turner International India Private Ltd (Turner) for engaging in the business of distribution of television channels of Zee Network and Turner Group.

    “The channel distribution business in the recent past was shifted to various entities and is currently housed under the company directly since 2016 and consequently there have been no active operations of ZNDL since last few years, except for holding 50 per cent equity stake in Zee-Star distribution joint venture 'Media-pro Entertainment Private Ltd’ (Mediapro), which discontinued the distribution business in 2014,” the company stated.

    “In view of this, the joint venture partners had mutually agreed to terminate the joint venture agreement with the acquisition of Turner's equity stake of 26 per cent (26,000 shares of Rs 10  each) in ZNDL by the company at par value aggregating to Rs 260,000/-, thereby making ZNDL a wholly-owned subsidiary of the company,” the letter added.

  • Zee Entertainment launches the Media & Entertainment Industry’s largest Learning & Development program for front line managers

    Zee Entertainment launches the Media & Entertainment Industry’s largest Learning & Development program for front line managers

    MUMBAI: Zee Entertainment Enterprises Ltd. (ZEEL), a leading media and entertainment powerhouse, has announced a pioneering initiative ‘Embark’ for the capability development of its front line managers. 

    Embark will focus on building front line managerial capabilities, both behavioural and functional. This program has been undertaken with a strong belief that front line managers are the linchpin between the broad strategies of management and their on ground execution. Embark in its entirety will upskill 450 front line managers across the organization and will provide 25,000+ hours of training. It is one of the most ambitious capability building exercise undertaken by ZEEL & one of the largest L&D program in the M&E industry.

    Based on behavioural, technical and digital skills, the program will be executed in four key phases that will empower, create and institutionalise the learning journey for a seamless transition of employees into their new managerial roles. Spanning seven months, the participants would go through multiple interventions inclusive of case  studies, skill-drills, role-play, webinars & e-reads across touch-points to help build their managerial capabilities. 

    “Managers are culture carriers, performance multipliers, risk mitigators and brand  custodians of any Company. With Embark, we aim to offer a holistic learning program for our front line managers that will empower them with an innovative and advanced working style and technical expertise,” said Mr. Animesh Kumar, Chief People Officer, ZEEL. “We are glad to partner with KPMG in India for this pioneering initiative that will help build a managerial capability intervention within the organisation focused  on internal talent growth ” he further added. 

    “With the demand on organizations to constantly renew themselves, they can no longer adopt a short-term approach to building capability. As a business and a strategic imperative, we believe that organizations in the M&E industry must incorporate new-age and holistic learning designs that act as catalysts to enable them to build the right capabilities,” said Girish Menon, Partner & Head – Media & Entertainment, KPMG  in India.

    Considering the current disruptions, challenges, and emerging trends in the M&E industry, Embark will help reinforce ZEEL’s commitment to invest in its talent pool & bring in best practices on managerial effectiveness & leadership development. 

    To harness the power of making extraordinary the reality, ZEEL, through this partnership will build a motivated workforce that will continue to provide the Company with superlative performance across functions. The initiative will revolve around building an  organizational ecosystem that attracts the best talent thereby enabling the Company to deliver exceptional performance.

  • BARC week 30: Movie channels dominate free channels lists across genres

    BARC week 30: Movie channels dominate free channels lists across genres

    BENGALURU: TRAI’s new tariff order (NTO) seems to have changed viewership patterns if one were to go as per Broadcast Audience Research Council of India (BARC) data. Of course, BARC has started slicing and dicing the data more and more specifically and hence enabling an improved scenario of viewership patterns in the country. But, NTO resulted in the major networks converting some of their free to air (FTA) channels to pay TV, hence enabling channels that remained FTA viewership to leapfrog. One of the biggest beneficiaries of the change in its competitions’ platforms to pay TV is Enterr 10 TV’s Hindi GEC Dangal. Dangal has often been the leader in BARC’s weekly list of top 10 channels across genres on all platforms as also in BARC’s weekly lists of top 10 Hindi GEC channels in the combined rural and urban Hindi speaking markets or HSM (U+R) as also in the rural Hindi speaking market or HSM (R). At the same time, Dangal has also been amongst BARC’s weekly list of top 10 Hindi GECs in the urban Hindi speaking market or HSM (U). Another channel that has reaped viewership benefits has been Zee Entertainment Enterprises Ltd (Zeel) FTA Hindi GEC Big Magic.

    Since week 27 of 2019, BARC has started reporting breakup of free and pay channels in the case of some markets, including the top 10 or 11 channels across genres. BARC’s weekly list of top 11 free channels across genres contains channels only from the region above the five South Indian states and the union territory of Puducherry – the Hindi speaking markets. BARC defines HSM as all India without the states in which the four South Indian languages – Kannada, Malayalam, Tamil and Telugu are spoken. Ten of 11 channels in BARC’s weekly list of top 11 free channels across channels are mostly either Hindi or Bhojpuri, the one exception being Marathi. Six of the 11 channels among the top 11 FTA channels across genres are movies channels – equally divided between Hindi movies and Bhojpuri movies. Often the number of Bhojpuri channels equals Hindi channels.

    Let us look at BARC’s weekly list of top 11 free channels across genres for week 30 of 2019

    BARC’s weekly list of top 11 free channels across genres  for week 30 of 2019 (Saturday, 20 July 2019 to Friday, 26 July 2019) had two Hindi GECs, three Hindi movies channels, four Bhojpuri channels including three Bhojpuri movie channels, and one channel each from the Marathi and music genres. From the networks’ perspective, there were four channels from Enterr 10 TV, three channels each from B4U Media and Zeel, and one channel from Skystar Entertainment Private Ltd (Skystar).

    All the 11 channels in BARC’s weekly list of top 11 free channels across genres were same as in week 29, but with a small tweak in ranks. As a matter of fact, the names and ranks of the first four channels in BARC’s weekly list of top 11 free channels across genres in week 30 of 2019 were the same as in week 29.

    As mentioned above, Dangal headed BARC’s weekly list of top 10 channels on all platforms across genres in week 30 of 2019. The channel climbed up one place to first rank with 866.547 million weekly impressions in week 30 of 2019 from second rank and 781.501 million weekly impressions in week 29. Dangal retained first rank in BARC’s weekly list of top 11 free channels across genres in week 30 of 2019 with 665.082 million weekly impressions as compared to 589.591 million weekly impressions in week 29. Dangal was ranked first in BARC’s weekly list of top 10 Hindi GECs in the combined urban and rural Hindi speaking market HSM (U+R) as well as in HSM (R) and was ranked sixth in HSM (U). Dangal also headed BARC’s weekly list of top 8 free Hindi GECs during the week under review.

    At second rank in week 30 was Big Magic with 405.141 million weekly impressions as compared to 358.730 million weekly impressions in BARC’s weekly list of top 11 free channels across genres. Big Magic was ranked seventh in BARC’s weekly list of top 10 Hindi GECs in HSM (U+R) on all platforms. Big Magic was ranked second in BARC’s weekly list of top 10 Hindi GECs in HSM (R) and was ranked eighth in HSM (U). It was ranked second in BARC’s weekly list of top 8 free Hindi GECs during the week under review.

    At third rank in week 30 of 2019 was B4U Media’s Hindi movies channel B4U Kadak with 325.020 million weekly impressions as compared to 347.028 million weekly impressions in the previous week. B4U Kadak was ranked second in BARC’s weekly list of top 5 Hindi movies channels on all platforms in HSM (U+R) and was ranked first in HSM (R). B4U Kadak was ranked first in BARC’s weekly list of top 5 free Hindi movies channels.

    At fourth rank was Enterr 10 TV’s Marathi channel Fakt Marathi with 162.021 million weekly impressions as compared to 184.384 million weekly impressions in week 29. Fakt Marathi was ranked second in BARC’s weekly list of top 5 Marathi channels in the Maharashtra and Goa market.

    B4U Media’s Bhojpuri channel B4U Bhojpuri climbed up a place to fifth rank in week 30 of 2019 with 157.775 million weekly impressions as compared to sixth rank and 154.732 million weekly impressions in the previous week. B4U Bhojpuri was ranked first in BARC’s weekly list of top 5 Bhojpuri channels in the Bihar and Jharkhand market. This indicates that the channel has viewers outside the Bihar and Jharkhand markets also.

    Enterr 10 TV’s Bhojpuri channel Bhojpuri Cinema dropped a place to sixth rank in week 30 of 2019 with 157.352 million weekly impressions as compared to fifth rank and 160.117 million weekly impressions in the previous week. Bhojpuri Cinema topped BARC’s weekly list of top 5 Bhojpuri channels in the Bihar and Jharkhand market.

    Another B4U Media Hindi movies channel, B4U Movies also climbed up a place to rank seven in week 30 of 2019 with 150.461 million weekly impressions as compared to eighth rank and 130.537 million weekly impressions in week 29. B4U Movies was ranked fifth in BARC’s weekly list of top 5 Hindi movies channels in HSM (U+R) and was ranked second in BARC’s weekly list of top 5 free Hindi movies channels.

    Zeel’s Bhojpuri channel Big Ganga dropped a place to eighth rank in week 30 of 2019 with 138.778 million weekly impressions as compared to seventh rank and 151.977 million weekly impressions in week 29. Big Ganga was ranked third in BARC’s weekly list of top 5 Bhojpuri channels in the Bihar and Jharkhand market.

    Skystar’s Hindi movies channel Skystar Movies retained its previous week’s ninth rank in week 30 of 2019 with 120.616 million weekly impressions as compared to 124.183 million weekly impressions in week 29. Skystar Movies was ranked third in BARC’s weekly list of top 5 free Hindi movies channels.

    Zeel’s Music channel Zing climbed a rank to tenth place in week 30 of 2019 with 102.370 million weekly impressions as compared to eleventh rank and 100.580 million weekly impressions in week 29.

    Dropping a place to eleventh rank in week 30 of 2019 was Enterr 10 TV’s Hindi movies channel Enterr 10 with 102.280 million weekly impressions as compared to tenth rank and 102.757 million weekly impressions in week 29.

    Enterr 10 was ranked fourth in BARC’s weekly list of top 5 free Hindi movies channels.

  • Punit Goenka picks solid over spectacular to steer Zeel ship in turbulent times

    Punit Goenka picks solid over spectacular to steer Zeel ship in turbulent times

    MUMBAI: 31 July was an extremely busy day for Zee Entertainment Enterprises Ltd (ZEEL) managing director and CEO Punit Goenka. Conference calls with investment analysts followed by video interviews with various business news channels late into the evening. Hardball questions were asked, he parried them with ease. Congratulations poured in and Punit responded to them all.

    This was a confident Punit. Not jubilant, but very businesslike. He sounded like a CEO in charge of his company, in control of its future. It appeared like he had finally emerged out of the shadows of his father the highly accomplished Subhash Chandra.

    By the end of it all, Punit, as he is known to all of us, understandably sounded tired. But it was a “good” fatigue.

    As committed, he had delivered on his promise to make an announcement before the end of July 2019 about the Essel Group promoter family finding an investor to help them free equity which had been pledged with mutual funds, NBFCs and banks to raise debt to finance their expansion into newer areas.

    US-based Invesco Oppenheimer’s – the investor’s  – offer was at Rs 400 per share and it had been holding on to 7.11 per cent of Zeel’s equity since 2002. And the fact that it took up another 11 per cent of the Indian owned global media group for Rs 4244 crore emphasises the confidence it has in the medium to long-term future of Zee as well as the faith it reposes in the ability of Subhash Chandra and his sons Punit and Amit Goenka and the teams within the group to ride over the current storm that it is facing. It has not demanded a board seat and has asked for no changes in the functioning, giving the family total management oversight.

    Some industry professionals snickered in private saying the deal is a damp squib. For one, the Zeel team failed in its efforts to get a strategic investor who would bring in global and technical expertise like Punit had proclaimed a few months ago. Second, the pricing of Rs 400 places the valuation of Zeel at about Rs 40,000 crore, which is much lower than what many expected.

    But Punit believes he has got the best deal in place for Zeel. Said he on the investment analysts’ call: “We had a strategic investor’s proposal on the table and the financial investor’s. We opted for the financial investor’s as the strategic investor would have taken time which would have gone beyond the deadline given to our lenders.”

    His view is that the valuation is something that can go only up, and even at Rs 400, it is at a premium of the Zee low for 2019.

    “The floor price has been laid now,” said Punit. “The next deal will happen much beyond this if it is required.”

    He, however, is sanguine that it will not be needed, as the Essel Group will be lopping off and hawking its non-media assets to cover the gap of Rs 6,800 odd crore.

    Punit, though, did not rule out the promoters offering further equity or partnering with other strategic investors in the media and entertainment space going forward.

    Other analysts point out pricing aside, the Invesco Oppenheimer deal is a coup for Punit Goenka. For one, it has allowed the management to be in the Indian promoters' hands. And they have been running a tight ship, with EBITDA margins being really healthy for several quarters.

    The second benefit is that acquisition by a strategic investor like Sony or Comcast or Reliance could have led to concentration of power in the hands of one of these three. As a consequence, a reduction in competitive forces in the media and entertainment – more specifically broadcasting – space.

    Having cleared the first hurdle of proving the doomsayers wrong, Punit now has to complete the Invesco Oppenheimer transaction, which he says will happen by end-August. (read: Zeel’s Punit Goenka on Oppenheimer divestment)

    But the bigger challenge is finding the rest of the Rs 6,756 crore which he has to pay to the Essel Group lenders without divesting any more equity in the media mother ship.

  • ZEEL’s Punit Goenka on Oppenheimer transaction, strategic investor, additional stake sale

    ZEEL’s Punit Goenka on Oppenheimer transaction, strategic investor, additional stake sale

    MUMBAI: Zee Entertainment Enterprises Ltd (ZEEL) on Wednesday announced what much of the media and entertainment as well as the investor ecosystem had been waiting to hear for a while. ZEEL reached an agreement with US-based Invesco Oppenheimer Developing Markets Fund for 11 per cent (around Rs 400 per share) of the promoter stake for Rs 4,224 crore. This essentially means the fund will intensify its shareholding to 18.7 per cent in the company.

    This is the second round of good news for the Essel Group promoter family after acing Q1 of FY20 with a 40 per cent jump in its profit at Rs 512 crore on a revenue of Rs 1,789 crore, capping off a 14.5 per cent year-on-year growth.

    The infusion of Rs 4,224 crore will give some relief to the group as it races to meet the 30 September deadline to pay off loans to the tune of Rs 11,000 crore to mutual funds, NBFCs and banks.  

    ZEEL MD & CEO Punit Goenka expects the Invesco Oppenheimer transaction to get completed by 31 August. He added that the deal will be done through an escrow mechanism wherein “the lenders will have to pool their shares and once the escrow agent confirms that the requisite number of shares have been placed, they will tell Oppenheimer to wire the funds and therefore on that day, the transfer of both will happen.”

    Goenka is confident that the promoters will be able to raise the remainder Rs 6,800-odd crore it needs to repay lenders by selling off some of its non-media assets in which it has invested like roads, infrastructure and solar energy. He was speaking to investment analysts late in the evening of 31 July.

    Invesco Oppenheimer, which until now owned 7.74 percent stake in ZEEL, is a pure equity shareholder and won’t have a seat on the board, he pointed out.

    “There’s no such agreement but I am pretty confident once investor like Invesco Oppenheimer is buying 11 per cent stake at certain price that validates our value. Therefore anybody else who may look at ZEE can’t really question it and that price should be very easily selling through,” said Goenka responding to whether ZEEL would sell rest of the stake below Rs 400 per share.

    Notably, Goenka did not rule out selling more promoter stake in the company. He also added that the Essel Group has zeroed in on buyers for some of its non-media assets. However, should the sale of these assets disrupt the repayment timelines, then the company will “step it up with the Zee stake sale,” Goenka revealed.

    ZEEL opted against a deal with a strategic partner for it would have taken longer to close the transaction thereby delaying the repayment process. 

    “Strategic investor is off the table for now,” Goenka remarked.

    He, however, briefly touched upon the possibility of ZEEL partnering some of its other media assets with like-minded strategic partners.

    Having consistently delivered profits and maintained a good growth trajectory, ZEEL’s prospect of finding a financial investor or strategic partner was doubted by few. This was despite mutual funds having witnessed their investments in the group turn illiquid of late.

    The sentiment was echoed by Invesco-Oppenheimer Developing Markets Fund portfolio manager Justin Leverenz who described the transaction as “highly compelling” for investors in the fund due to the “sound fundamentals of Zee.”

    The latest development is bound to cheer investors and lenders like mutual funds and insurance companies that had lent considerably to ZEEL’s promoters against collateral.

    “After this entire episode, promoters will be left with enough stake in ZEE for them to get motivated and excited to continue running the company with the legacy it has done so far,” Goenka remarked.

    With the ZEEL promoters now set to repay the debt to lenders and investors from the proceeds of the stake sale, some of the debt funds that have been under the pump will now also be able to fulfill commitments to their investors.

    It has taken ZEEL extended deadlines to get to this point. In a sense, the entire process from taking the tough call to sell promoter stake to striking the right deal amidst back-to-the-wall negotiations has been synonymous with what founder and chairman Subhash Chandra has embodied all his life – living to fight another day.