ZEE welcomes Invesco’s belief in the true potential of the proposed merger with Sony

Zee Entertainment Enterprises Ltd (ZEEL) has welcomed the decision by Invesco Developing Markets Fund and OFI Global China Fund LLC for its belief in the true potential of the proposed merger with Sony Pictures Networks India (SPNI) and for its faith in the management’s approach.

Earlier this week, Invesco had issued a release wherein it had stated, “Since we announced our intention to requisition an EGM and add six independent directors to ZEE’s Board of Directors, ZEE has entered into a merger agreement with Sony. We continue to believe this deal in its current form has great potential for ZEE shareholders. We also recognise that, following the merger’s consummation, the board of the newly combined company will be substantially reconstituted, which will achieve our objective of strengthening board oversight of the company.”

Invesco went on to state that it has decided not to pursue the EGM as per the Requisition dated September 11, 2021 and accordingly, it will proceed to withdraw the application pending for that purpose before the National Company Law Tribunal.

As reported earlier, the Bombay High Court on March 22, 2022 allowed the appeal by Invesco against a single-judge order issuing an interim injunction to hold an Extraordinary Ordinary General Meeting (EGM) of the shareholders of ZEE. Reacting to the Bombay High Court’s decision recognising Invesco’s requisition for an EGM as legally valid and upholding Invesco’s right to requisition an EGM at ZEE, Invesco had stated, “We are pleased with the Bombay High Court’s ruling, which we view as an important reaffirmation of shareholder rights in India and the mechanisms under Indian law to hold Boards accountable to their shareholders. The ruling is a boon for corporate governance in India and a win for shareholder democracy.”

Invesco further added that it will continue to monitor the proposed merger’s progress. “If the merger is not completed as currently proposed, Invesco retains the right to requisition a fresh EGM,” it said.

Meanwhile, ZEE in its statement said that as the company takes the required steps forward in seeking all the regulatory approvals as mandated by law, to complete the proposed merger, it continues to seek the required valuable support from all its stakeholders.

It added, “Invesco has been an integral part of ZEE’s value-creation journey for almost two decades; and the company acknowledges this support. Under the able guidance of its esteemed Board and the strategic approach undertaken by its management, the company remains focused on the completion of the proposed merger with SPNI, which is in the best interest of all the stakeholders.”

Invesco Developing Markets Fund (formerly Invesco Oppenheimer Developing Markets Fund) and OFI Global China Fund LLC are the largest shareholders of ZEEL and hold 74,318,476 equity shares and 97,350,000 equity shares, respectively, representing an aggregate of 17.88% of the paid-up share capital of ZEEL, as of March 23, 2022, which carries the right of voting.