Legal fight on anvil as Dish TV board rejects YES Bank’s demand for EGM

Even as the corporate battle over Zee Entertainment Enterprises has reached the Bombay High Court, another Essel Group firm, Dish TV India Ltd, is gearing up for a legal battle with YES Bank by planning to move the National Company Law Board to appoint six of its nominees on the board of the loss-making company.

While Dish TV said that YES Bank has acquired 26 per cent stake by invoking pledged shares of Essel Group promoter, it also said YES Bank must make an open offer to the shareholders of Dish TV as per Sebi takeover code. This, as YES Bank is seeking to take control of the company, said Dish TV. “The Dish TV management has sent a detailed response to YES Bank and now the ball is in their court,” said a Dish TV source. The promoters own 6 per cent stake in the company.

Both YES Bank and Dish TV declined to comment on their legal strategies.

Dish TV is also of the opinion that the nominee directors of YES Bank require clearance from other lenders as well as security clearance from the Ministry of Information and Broadcasting and till such clearances does not come, it will not be able to clear the EGM notice.

YES Bank had sought to appoint its nominees in the annual general meeting of shareholders scheduled for September 27, but the AGM got postponed.

A day before, on September 26, YES Bank had asked the company to call an extraordinary general meeting of shareholders to appoint its nominees and remove current CEO and MD, Jawahar Lal Goel, and directors, Ashok Kurien, Rashmi Agarwal, Bhagwan Das Narang, and Shankar Agarwal from the board. Kurien has already quit from Zee Entertainment board after a demand from Zee’s largest shareholder, Invesco, which claims corporate governance lapses.

YES Bank had earlier said that the Dish TV’s current board is acting on the behest of the promoters who hold only 6 per cent stake in the company and approved a Rs 1,000-crore rights issue despite its objections. YES Bank said Indian lenders have 45 per cent stake in the company and that it is taking this step to re-constitute the board to protect the rights of all the shareholders.

YES Bank has already approached the market regulator, the Securities and Exchange Board of India and the stock exchanges after the company did not take any action on June 19, 2021 when it sought to appoint its nominees and asked the company not to go ahead with the right issue. In its communication to Dish TV, which was later filed with the stock exchanges, YES Bank said the board is acting in haste and is taking steps to dilute their stake and hence its demand to re-constitute the board.

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