The promoter family of Zee Entertainment Enterprises Ltd is looking to raise their stake in the company to 26 per cent, eventually.
However, this has raised questions about funding such an exercise.
The promoters hold 4 per cent in Zee at present, making them susceptible to hostile takeovers.
In an interview with a business daily, Subhash Chandra, chairman emeritus, Zee Entertainment Enterprises Ltd, said the promoters are keen to immediately raise their holding to 5 per cent and 26 per cent over a period of time.
Admitting this will require a lot of cash, Chandra said they are not looking to raise the funds from external sources.
Shares of Zee on Monday ended at Rs 161.60, a drop of 1 per cent from Friday. The market valuation of the company stood at Rs 15,522 crore.
The promoters will need almost Rs 800 crore to raise their holding by 5 per cent at current prices and a little over Rs 3,400 crore to raise it to 26 per cent.
Observers said it would be difficult for the Chandras to source external funds, given the probe by market regulator Sebi on alleged fund diversion by the promoters and the loss in the value of Zee shares after Sony terminated the $10 billion merger.
Chandra reportedly said he has approached his younger son Amit Goenka, a successful NRI, to invest in the company and that he has agreed to invest in Zee.
He said as a promoter, he was “seriously considering” filing a criminal case against Sony.
Meanwhile, all eyes are now on the institutional shareholders on whether they will seek the ouster of Punit Goenka, the current managing director & CEO of Zee after the collapse of the Sony deal.
On its part, Zee has moved the National Company Law Tribunal (NCLT) against Sony’s decision to terminate the merger. In its application, Zee has sought directions from the tribunal to implement the merger.
Meanwhile, Disney Star is mulling legal actions against Zee Entertainment for backing out from a $1.4 billion sub-licensing agreement for TV broadcast of international cricket matches in India, according to industry sources.
