New Delhi: The boardroom tussle at Zee Entertainment Enterprises Ltd (Zeel) rages on. One of its top investors, Invesco Developing Markets Fund has now moved the National Company Law Tribunal (NCLT) against the company for not yet announcing a date of the extraordinary general meeting (EGM).
The application moved under Sections 98(1) and 100 of the Companies Act, 2013 requests the tribunal to order the company to hold EGM. The NCLT has listed the hearing on Thursday.
“The company’s failure to take steps within its notice period to call an EGM, coupled with its delay in noticing our EGM on 11 September and failure to notice our 23 September letter to the exchanges, has prompted us to file a petition before NCLT to enforce our rights as shareholders to call for this EGM,” a spokeswoman for Invesco said.
One of the largest shareholders of Zeel, Invesco Developing Markets Fund 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 funds 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).
Invesco and OFI Global China Fund IIC together hold an 18 per cent stake in the media company. According to rules, a company has three weeks to announce a date for an EGM from the day it receives such a request from any of its big investors. So, if the special notice was received by Zeel on 12 September, then the company has until October 2 to announce a date for an EGM.
The latest move comes days after Zeel announced a mega-merger with its rival media group Sony Pictures Network India (SPNI). The merger will result in SPNI holding a majority of 52.93 per cent with Zeel and its shareholders having 47.01 per cent of the new entity which will continue to list on the stock exchanges. The joint company will appoint Punit Goenka as the CEO and managing director, with the promoter family being free to increase its holding from four per cent to 20 per cent over time.
