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NEW DELHI : Invesco Developing Markets Fund and OFI Global China Fund Llc, the largest shareholders of Zee Entertainment Enterprises Ltd, renewed their call for an extraordinary general meeting (EGM) to remove Zee’s chief executive and managing director Punit Goenka from the board.

On 13 September, the two institutional investors, with a 17.88% stake in Zee, also called for the removal of independent directors, Ashok Kurien and Manish Chokhani, and appointing six independent directors—Surendra Singh Sirohi, Naina Krishna Murthy, Rohan Dhamija, Aruna Sharma, Srinivasa Rao Addepalli and Gaurav Mehta. Soon after both Chokhani and Kurien resigned from the board.

In its second letter to the board on 23 September, Invesco reiterated its EGM call, citing a Zee disclosure to stock exchanges about a non-binding term sheet that was signed with Sony.

Last week, Zee’s board submitted an in-principle nod for the merger with Sony Pictures Networks India (SPNI). The two firms have entered a non-binding term sheet that offers 90 days for Zee and SPNI to conduct due diligence and finalize the definitive agreements to combine their linear networks, digital assets, production operations and programme libraries.

The merged entity will be a publicly listed company in India with Essel Group founder and chairman Subhash Chandra’s son Punit Goenka continuing as the managing director and chief executive officer of Zee, the company said in a stock exchange filing last week.

In its letter, Invesco said “decisions of material strategic import must follow and not precede actions towards establishment of a proper and independent governance structure as determined by the company’s shareholders". The investor added that the merger announcement with Sony “is symptomatic of the erratic manner in which important and serious decisions have been handled" by the company.

“Precisely to protect shareholder value and in exercise of our statutory rights as an ordinary shareholder, we have called upon the company to hold an EGM and it is your duty under company law to now do so."

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