Subhash Chandra’s Essel Group, the promoter of Zee Entertainment Enterprises Limited (ZEEL), has sold 11 per cent of it 36 per cent stake to Invesco Oppenheimer Developing Markets Fund for a total consideration value of up to Rs 4,224 crore. The fund already holds 8 per cent stake in the entertainment company. After the additional stake buy, the fund’s shareholding in ZEEL will rise to 19 per cent, while the promoters’ stake will come down to 25 per cent.
The Essel group had in November announced that promoters intended to sell half their stake in ZEEL (which was 42 per cent at the time) to strategic investors, preferably a global tech company. In January this year, Essel group lenders started selling shares in Essel companies like ZEEL and Dish TV to recover the debt accumulated by the company. The parent company had an accumulated debt of Rs 16,000 crore. At the end of the March 2019 quarter, Zee promoters had pledged 66.18 per cent of their shareholding to lenders.
In order to repay the debt, Essel had initiated the process of divesting its key assets, including ZEEL, with an aim to repay all lenders by September 2019. During this divestment process, the group said it received positive responses from multiple partners expressing their interest to buy a stake in ZEEL and other key non-media assets. The company is said to be in talks with Bharti Airtel for the merger of its DTH business, operated as Dish TV, with the telecom giant's digital TV business. The promoters are expected to cash out of the company for Rs 4,500-5,000 crore.
Punit Goenka, managing director and CEO of ZEEL, said: “I’m extremely glad to share that the fund as a financial investor has further reposed its faith in ZEEL. It also gives me immense pleasure to note their strong belief and trust in the intrinsic value of our precious asset. It is the valuable belief and support of our esteemed financial investors that enables us to consistently generate great value, year after year.”
The Invesco Oppenheimer Developing Markets Fund, an investment company registered with the US Securities & Exchange Commission, has a long history of investing in India as a financial investor. The fund has been a financial investor in Zee Entertainment Enterprises Ltd since 2002.
The Essel group had in November announced that promoters intended to sell half their stake in ZEEL (which was 42 per cent at the time) to strategic investors, preferably a global tech company. In January this year, Essel group lenders started selling shares in Essel companies like ZEEL and Dish TV to recover the debt accumulated by the company. The parent company had an accumulated debt of Rs 16,000 crore. At the end of the March 2019 quarter, Zee promoters had pledged 66.18 per cent of their shareholding to lenders.
In order to repay the debt, Essel had initiated the process of divesting its key assets, including ZEEL, with an aim to repay all lenders by September 2019. During this divestment process, the group said it received positive responses from multiple partners expressing their interest to buy a stake in ZEEL and other key non-media assets. The company is said to be in talks with Bharti Airtel for the merger of its DTH business, operated as Dish TV, with the telecom giant's digital TV business. The promoters are expected to cash out of the company for Rs 4,500-5,000 crore.
Punit Goenka, managing director and CEO of ZEEL, said: “I’m extremely glad to share that the fund as a financial investor has further reposed its faith in ZEEL. It also gives me immense pleasure to note their strong belief and trust in the intrinsic value of our precious asset. It is the valuable belief and support of our esteemed financial investors that enables us to consistently generate great value, year after year.”
The Invesco Oppenheimer Developing Markets Fund, an investment company registered with the US Securities & Exchange Commission, has a long history of investing in India as a financial investor. The fund has been a financial investor in Zee Entertainment Enterprises Ltd since 2002.
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