Zee promoters to raise stake via ₹2,237 crore preferential issue
Zee board approved the issuance of 16,95,03,400 warrants to promoters at ₹132 each, raising their stake to 18.39% from 4.28%. The move aims to strengthen the company's financial position and support growth initiatives, pending shareholder approval.
The promoters of Zee Entertainment Enterprises Ltd are set to increase their stake in the company to 18.39% through a preferential allotment of fully convertible warrants worth ₹2,237.4 crore, as the media firm looks to shore up its financial foundation and accelerate its pivot to a content-tech-led growth strategy.
The Zee board, after two rounds of meetings on Sunday, approved the issuance of up to 16.95 crore warrants to promoter group entities at ₹132 per warrant, higher than the regulatory floor price of ₹128.58, according to a company statement.
The promoter group, led by Subhash Chandra, currently owns 4.28%.
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Investment bank JP Morgan had earlier presented strategic alternatives and reviewed Zee’s medium-term growth initiatives.
The move, subject to shareholder approval, aims to equip the company with long-term capital to fund its diversification and digital bets. It comes even as Zee continues to battle sluggish stock performance and navigates the fallout of its failed merger with Sony.
The warrant issue marks the first major promoter-led capital infusion into Zee in several years. The promoters had submitted their intent to enhance shareholding on 1 May, when the stock traded at ₹106.35, the company disclosed.
R. Gopalan, chairman of ZEEL, said the move will not only “enhance the promoter shareholding” but also “ensure their added motivation to work in line with the enhanced business plan.” He said the infusion will bolster Zee’s balance sheet as it executes new strategic initiatives in the evolving media and entertainment space.
Shubham Shree, representing the promoter group, reaffirmed their commitment despite the higher pricing. “The promoters are committed to the company and its business even at this higher price.”
Zee recently announced an investment in micro-drama app ‘Bullet’ and has launched three new subsidiaries to diversify its operations. In a May investor presentation, the company outlined its aim to become a content and technology powerhouse.
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