Will take proper action as per applicable law: Zee on board revamp demand

Two investment firms had earlier this month sought an extraordinary general meeting to remove MD Punit Goenka and two independent directors

Zee Entertainment Enterprises on Monday said it will take "necessary action as per applicable law" amid demand for the ouster of Managing Director Punit Goenka by two institutional investors.

Two investment firms -- Invesco Developing Markets Fund (formerly Invesco Oppenheimer Developing Markets Fund) and OFI Global China Fund LLC, which together hold 17.88 per cent stake in ZEEL -- had earlier this month sought an extraordinary general meeting to remove Goenka and two independent directors Manish Chokhani and Ashok Kurien.

Chokhani and Kurien had subsequently resigned from the board.

When reached out for comments on the demand from the two institutional investors, a ZEEL spokesperson said the board is seized of the matter.

"The company will take the necessary action as per applicable law," the spokesperson said without elaborating further.

The investment firms had also sought the appointment of six of their own nominees on the board of the company - Surendra Singh Sirohi, Naina Krishna Murthy, Rohan Dhamija, Aruna Sharma, Srinivasa Rao Addepalli and Gaurav Mehta.

Invesco and OFI Global China had also enclosed the relevant declarations and information required from each of the proposed Independent Directors, which is required while seeking approval from the Ministry of Information and Broadcasting (MIB) while making changes.

Last week, ZEEL had announced a merger plan with Sony Pictures Network India (SPNI), under which the latter will hold a 52.93 per cent stake in the merged entity and Zee the remaining 47.07 per cent.

Invesco has reportedly written another letter to ZEEL, opposing the merger plan with Sony, terming the development as symptomatic of the company's erratic manner of handling important and serious decisions. It also reiterated its demand for the removal of Goenka.

In July 2019, Subhash Chandra-led Essel Group had roped in existing investor Invesco Oppenheimer to raise its stake in flagship Zee Entertainment Enterprises by another 11 per cent for Rs 4,224 crore.