Invesco moves NCLT against Zee, petition to be heard on Thursday

Invesco Fund, the shareholder with 18 per cent stake in Zee Entertainment Enterprises (ZEEL), on Wednesday has moved the National Company Law Tribunal. The fund wants ZEEL to call an extraordinary general meeting of shareholders to induct its nominees on the company’s board. Invesco has moved NCLT under Section 98 (1) & 100 and has sought NCLT’s intervention to direct Zee Entertainment to call for EGM.

Earlier this month, Invesco, an Oppenheimer Holdings-backed fund, had asked ZEEL board to appoint six of its nominees on ZEEL board and had asked the company to call an EGM. Invesco also wanted ZEEL’s current CEO and MD, Punit Goenka to be removed. Goenka is son of Essel group patriarch, Subhash Chandra, and the family currently owns only 4 per cent stake in the company.

NCLT will hear the petition on Thursday.

When contacted, a ZEEL spokesperson said: “The Board of the company remains committed to act within the framework of law and is focused towards enhancing the company’s growth and shareholder value. It is in the process of taking the required steps within the statutory period. The company does not wish to comment on any impulsive or premature steps taken by Invesco Developing Markets Funds and OFI Global China Fund, LLC.”

ZEEL shares closed flat at Rs 310 on Wednesday.

In a letter dated September 23, Invesco and Oppenheimer Funds asked ZEEL to adhere to its fiduciary duties and not violate its statutory obligations to convene the EGM as requisitioned by Invesco on September 11. “We urge the board to reflect on this communication and act in the best interest of the company, its public shareholders and uphold the highest standards of corporate and board governance,” Invesco said.

Soon after Invesco’s first letter, ZEEL announced a merger deal with its rival Sony Pictures, creating a $2-billion revenue company with a 25 per cent market share.

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