Zee Entertainment to invest Rs 522 cr on subsidiary Margo Networks

Zee Entertainment Enterprises Ltd (ZEEL) on Thursday said its board has approved investing Rs 522 crore in its arm Margo Networks Pvt Ltd, which offers content distribution services under 'SugarBox' brand that empowers to users without an active internet connection to use mobile apps.

The board of the company at its meeting held on April 8, 2020, has agreed to extend financial and operational support to SugarBox and the company will invest a sum of Rs 522 crore in SugarBox over a period of time, ZEEL said in a regulatory filing.

ZEEL will provide operational support, including through providing performance and corporate guarantees as appropriate and necessary and has authorised SugarBox to finalise the terms of 10 years contract with RailTel Corporation of India Ltd, it added.

The company in 2017 acquired 80 per cent equity stake in Margo Networks Pvt Ltd with an eye to exploit strong synergies of the technology developed by SugarBox with its current business and with a potential to significantly augment digital content consumption, the company said.

Since the initial investment Margo Networks has developed and patented technology under its brand SugarBox that enables seamless access to mobile apps, even in places with bad or no network and empowers users without an active internet connection to use mobile apps, it added.

"The most disruptive part is that there are no data limits or data charges to the consumer for consumption across supported apps on the SugarBox network. With the successful pilots of this technology, SugarBox has secured long term exclusive contracts with public transport corporations," ZEEL said.

SugarBox has also recently bagged a Letter of Award (LOA) to power trains operated by the Indian Railways, Kolkata Metro and all Wi-Fi enabled stations for a period of 10 years, the filing added.

With the fresh investment, ZEEL said, "SugarBox will commence commercial operations across existing contracts like L&T Metro, Chennai Metro, NMMT, Kolkata Metro, Indian Railways and forge new partnerships to scale up its network."