Shares of Zee Entertainment Enterprises Ltd (ZEEL) rose over 8% after it was reported that the media company has agreed to repay dues owed to IndusInd Bank Ltd, bringing the company closer to resolving insolvency proceedings and completing a merger with a unit of Sony Group.
Zee Entertainment Enterprises Ltd shares were seen trading at Rs 205, up by Rs 15.95 or 8.44% on the Bombay Stock Exchange (BSE) at 2.45 pm Thursday.
The repayment of dues, which is around Rs 83.7 crore, is expected to be settled as early as Friday. Upon receipt of the repayment, the Mumbai-based bank has agreed to withdraw its insolvency proceedings against ZEEL, according to Bloomberg.
The case pertains to a default of Rs 89 crore by Essel Group’s multisystem operator arm Siti Networks, which IndusInd Bank claimed and for which ZEEL was a guarantor.
It is to be noted that IndusInd Bank on February 22 dragged the media company to National Company Law Tribunal (NCLT), seeking insolvency proceedings against ZEEL. The NCLT agreed to admit the case and appointed an interim resolution professional after suspending the board.
The National Company Law Appellate Tribunal (NCLAT) stayed the insolvency proceedings initiated against ZEEL on February 24. The appellate tribunal issued notices to IndusInd Bank and the interim resolution professional directing them to file a reply in two weeks after admitting a petition filed by ZEEL Managing Director and CEO Punit Goenka.
The NCLAT stay order was seen as a major reprieve for ZEEL, which is merging with rival Culver Max Entertainment, formerly known as Sony Pictures Networks India, creating India’s biggest media empire. The company has received necessary approvals from shareholders, creditors, bourses, and CCI, and is awaiting final go-ahead from NCLT.
