Thursday, 13 July 2023, Bengaluru, India
A ZEE-Sony media merger looks imminent now as the ongoing trouble at ZEE continues. As the matter moves forward, the Securities Appellate Tribunal (SAT) dismissed ZEE’s appeal in the SEBI case on Monday. Industry specialists look at this event as a catalyst in working on the ZEE-Sony merger.
While SAT dismissed ZEE’s appeal in the SEBI case, ZEE Entertainment’s MD and CEO Punit Goenka, along with ZEE Group’s Chairman Subhash Chandra are willing to move the case to the Supreme Court of India. After SAT’s dismissal, reports suggest that the media company is looking at other ways to sort this out, and best of all, the option is to go to the Supreme Court.
On June 12, the markets regulator SEBI restrained the ZEE entertainment duo, Subhash and Punit, from holding any managerial or directorship position in listed entities because of alleged fund diversion. While the Securities and Exchange Board of India (SEBI) might have made a harsh decision against Subhash and Punit, SAT didn’t find it plausible to affirm any claims made by the two in their case against SEBI.
As per reports, SAT didn’t want to interfere in the matter and offered advice to the two to defend themselves against SEBI by providing a fitting answer to SEBI’s accusations. Subhash and Punit found themselves in this mess after Yes Bank alleged the media company of appropriation of certain fixed deposits to square off loans of related entities of Essel Group. Subhash Chandra is Essel Group’s chairman. After the allegation, SEBI restricted Punit Goenka and Subhash Chandra from holding any key management personnel (KPM) roles until further notice or until proven innocent.
Punit and Subhash are currently accused of siphoning funds for their benefit without providing knowledge to any board members or even the bank.
According to the SEBI probe, Essel Group’s chairman Subhash Chandra provided a letter of comfort (LoC) towards credit facilities availed by certain group companies from Yes Bank. This letter was unknown to many people, including ZEE Entertainment and Enterprise Limited (ZEEL).
While a few knew of this letter, it was still a managerial fraud and was destined to receive backlash. SEBI listed in its probe that Subhasha and Punit abused their managerial positions as the highly placed company officials of a listed company to cash out funds for their benefit. While everything is still under the bed, SEBI will soon carry out a detailed and careful investigation.
As things go on for both of them, it has anything to do with the ZEE-Sony merger; industry experts share their opinion. Karan Taurani, Senior Vice President at Elara Capital, says that whatever happens in the SEBI case won’t affect the ZEE-Sony merger and would only affect certain individuals at a personal level.
People in the media and communications industry sound positive about the ZEE-Sony merger amid ZEE’s inclusion in a SEBI probe. People with knowledge about the matter say that it won’t affect the merger and things shall soon see the light of the day.
Source – Exchange4media , Business Today
