Zee May Cut Adr Size

Zee Telefilms is considering a reduction in the size of its proposed American depository receipts issue from $1.5 billion or 40 million equity shares to "less than $1 billion," according to merchant banking sources.

Industry sources said the company was thinking of reducing the ADR size by around $500 million in line with prevalent market conditions. Zee's share price dropped to Rs 603 on the Bombay Stock Exchange yesterday. The scrip was quoted at Rs 1,063 on April 12, less than a month ago.

Zee has appointed US-based Donaldson Luffkin Jenerette and DSP Merrill Lynch as the lead managers for the ADR issue. It will shortly appoint at least two co-lead managers for the issue, sources said.

 

When contacted, group chief financial officer and Zee Network executive director (finance) B R Jaju declined to comment on the appointment of the lead managers.

However, when asked about reducing the size of the issue, Jaju said " The issue will be to meet the real needs of the company's expansion and marketing plans. We have to ultimately return value to our shareholders. We will not raise money for the sake of it but it will be in confirmity with the business plans of the company, " he added.

However Jaju said a final decision would be taken after consultation with the merchant bankers and market appetite.