Promoters help ZEEL's Chandra to retain control: Report

Now, Chandra owns only 5% of the company's stake, according to data from the National Stock Exchange (NSE). (Image from ZEEL official website)

A group promoters of Zee Entertainment Enterprises Ltd sold more than 14 crore shares in bulk deals on November 21, helping founder Subhash Chandra to retain control of India’s largest listed television network, according to a report by Mint.

International investors such as GIC Pvt. Ltd, BlackRock, HSBC Global, Fidelity India, Norges Bank, Marshall Wace, Wellington Management and local funds including SBI Mutual Fund and Reliance Mutual Fund bought the pledged promoter stake in ZEEL through a series of block deals on Thursday.

The sale helped ZEEL promoters raise Rs 4,343.18 crore, which will be used to repay creditors to whom Chandra had pledged shares.

Now, Chandra owns only 5% of the company's stake, according to data from the National Stock Exchange (NSE).

The big buyers were Government of Singapore which bought 28,500,000 shares and Societe Generale bought 16,690,000 shares of the company.

Subhash Chandra's son Punit Goenka said on twitter, "Glad to share that the book was oversubscribed by approximately three times. I am grateful to our lenders and investors for their trust. I remain committed to elevate ZEE to a global media & entertainment powerhouse!"

Shriram Subramanian, managing director of InGovern Research Services Pvt. Ltd, a proxy advisory firm told the daily, "A company such as ZEEL with high institutional shareholding is susceptible to a takeover, maybe not immediately but in the future. Investors need to be aware of this and need to closely watch this."

“Shareholders will now have to decide if they want Punit Goenka to continue as CEO and if they want the current promoters to continue in their roles," he said to the newspaper.

Shares of Zee Entertainment Enterprises on Thursday zoomed over 12 per cent after Essel Group said it was planning to sell 16.5 per cent stake in its flagship firm to meet its loan repayment obligations. The network's shares closed at Rs 345.25 on the BSE and it jumped 14.99 per cent to Rs 353.20, in the early hours of trade.

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