The ongoing tussle between Zee Entertainment Enterprises Ltd. (ZEEL) and its largest investor, Invesco turned a new turn lately with ZEEL approaching the National Company Law Appellate Tribunal (NCLAT) after moving from the High court, followed by the National Company Law Tribunal (NCLT).
NCLT had ordered Zee Entertainment Enterprises to submit a reply on a petition filed by Invesco and OFI Global China on Tuesday, giving time till Thursday. To this, ZEEL had asked for extra time in order to file a response.
Invesco, which is ZEEL’s largest shareholder owns 17.8% stake in the company had initially approached the NCLT to direct the company’s board to hold an extra-ordinary general meeting in order to debar the present managing director and chief executive officer, Punit Goenka from the board.
The spokesperson from ZEEL had stated that the company has moved to National Company Law Appellate Tribunal (NCLAT) following the due process and provisions provided under the law. Additionally, the company has also filed for a suit in Bombay High Court in order to declare that the requisition notice sent by Invesco Developing Markets Fund and OFI Global China Fund LLC is invalid. They stated that the company continues to have full faith in the Indian judicial system and would take all the required steps that are in the best interests of all its shareholders.
Invesco and OFI Global China Fund is represented by Law firm, Dhruve Liladhar & Co, in this case, while ZEEL and Goenka appointed the law firms Trilegal and the Economic Laws Practice (ELP) to represent them.
As a latest statement issued by the founder and chairman emeritus of Zee Entertainment Enterprises (ZEE), Subhash Chandra, he chided Invesco’s proposal for the removal of MD & CEO Punit Goenka followed by the reconstitution of the company’s board, a “clandestine attempt” stimulating an “illegal” takeover of the ever-standing company.
On Wednesday, Subash Chandra reminded their largest investor, Invesco that their position in the company stand merely as shareholders and not as owners and stated the significance of the real owners as public shareholders.
Shedding light on the 2.5 lakh public shareholders of the company, he stated that they are actually the real owners of the company and not Invesco or Punit Goenka. He claimed that Invesco is attempting to take over the company through illegal means, using the provisions of the Companies Act to “hide behind”. Nonetheless, the Ministry of Information and Broadcasting (MIB) also governs the broadcasting sector and there are coherent rules set in place for any attempt of takeover. He also reinstated that an attempt by a foreign company to take over ZEEL has occurred before and is not the first time.
September 11th marked the date when Invesco sent a requisition to the company, seeking an extraordinary general meeting (EGM) of the shareholders with the agenda to remove Punit Goenka along with two other directors. It also called for an addition of six other independent directors.
The Mumbai bench of the National Company Law Tribunal (NCLT) is hearing the matter, but nevertheless, ZEE has also filed a civil suit in the Bombay high court seeking a direction to declare the notice invalid on multiple legal infirmities..
In is talks with ZEE, Subash Chandra said “In 1994, I was offered $500 million by an international media baron. I told him, India is not for sale. Today, when we are in a similar situation, I will tell them the same thing,”
However, he also added that in case Invesco wants to indeed take over the company, they must do it in the appropriate manner. He directed appealed them to come out and present their deal in front of the shareholders and leave it on the share hold’s discretion to decide upon the offer.