Investment firm Invesco Developing Markets Fund will sell a total of 7.8 percent stake in Zee Entertainment Enterprises Ltd (ZEEL) for as much as Rs 2,171 crore via a block deal tomorrow (April 7).

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The shares are being offered between Rs 270 - Rs 290 apiece, representing a 7 percent discount from the current market price. Kotak Securities is the sole book-running manager for the deal.

Shares of Zee Entertainment Enterprises ended at Rs 290.950, down by Rs 9.10, or 3.03 percent on the BSE. Invesco Developing Markets Fund, the largest shareholder in Zee Entertainment Enterprises, owns an 18 percent stake in the company.

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Upon completion of the bookbuild, funds managed by Invesco’s Developing Markets investment team, including Invesco Developing Markets Fund, will continue to own at least 11 percent of ZEEL, underscoring the investment team’s belief that the Sony deal in its current form has great potential for Zee shareholders.

Last month, the Bombay High Court had allowed an appeal filed by Invesco Developing Markets Fund against a single-judge order granting an interim injunction on holding an EGM to remove Zee's CEO Punit Goenka. A division bench of Justices S J Kathawalla and Milind Jadhav quashed and set aside the single bench order of October 2021.

In September 2021, Invesco had put out a requisition to the Zee Board of Directors to hold an extraordinary general meeting (EGM) on the grounds that it felt the company was not running as smoothly as desired.

The firm sought to remove three directors from Zee's Board, including Managing Director and Chief Executive Officer (CEO) Punit Goenka.

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When Zee refused to respond to the requisition, Invesco moved an application before the National Company Law Tribunal (NCLT) in Mumbai, which directed Zee to consider the requisition in accordance with the law. Zee then approached the high court, seeking a declaration that the requisition notice by Invesco to hold the EGM was illegal and invalid.

A single bench of Justice Gautam Patel had in October 2021 in an interim order granted an injunction against holding of the EGM. Subsequently, Invesco filed an appeal against the interim injunction order on the ground that the high court had no jurisdiction to hear the matter and that it ought to have been heard and decided by the NCLT.

(Edited by : Jomy Jos Pullokaran)

First Published:Apr 6, 2022 6:39 PM IST