MUMBAI: Debt-ridden Essel Group  is planning to sell a 16.5 per cent stake in its flagship property  Zee Entertainment Enterprises Ltd (ZEEL) to financial investors to clear off its massive debt. After this transaction, Essel Group’s overall holdings in ZEEL will be five per cent, as mentioned in a statement to the Bombay Stock Exchange.

“The group seeks to sell up to 16.5 per cent stake in ZEEL to financial investors, in order to repay loan obligations to certain lenders of the group for whose benefit such shares are currently encumbered (and who have consented to such share sale by the Group). Out of the aforesaid the group seeks to sell 2.3 per cent stake in ZEEL to OFI Global China Fund, LLC and or its affiliates,” the company stated in a statement.

“This development reaffirms the group's positive progress on its overall asset divestment approach, undertaken to generate adequate liquidity for the repayment process. The group is alsoworking actively on further divestments including its medial non-media assets and remains confident to complete the same,” it added.

Earlier in August, 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. At that time, ZEEL MD and CEO Punit Goenka did not rule out selling more stake in the company.

In November last year, Subhas Chandra-led Zeel had revealed the decision of its promoters to sell up to 50 per cent of their equity in the company to a strategic partner.