Invesco Developing Markets Fund, an arm of the US-based conglomerate, has mandated Kotak Securities to sell around 75 million Zee shares through block deals on Thursday. The move comes two weeks after Invesco withdrew its demand for removal of MD Puneet. goenka From the company, which was founded by his father in 1992.
Invesco currently holds an 18.8% stake in the broadcaster, which is in the process of merging its operations with the India arm of Japanese media house Sony. Invesco said that its decision to retain an 11% stake in Zee, where it first investigated in 2002, “underscores the belief that Sony in its current form has great potential for the company’s shareholders”.
Invesco had raised its stake in Zee from 18.8% to 18.8% in August 2019 by buying shares from promoters who needed funds to pay off debt. The transaction made Invesco the largest shareholder in Zee, but no position on the board. On Wednesday, Invesco said its three funds are selling a total of 7.8% stake in Zee, “to Zee to align its investments with other funds managed by its investment team and achieve total ownership status”.
In September 2021, Invesco had called for an Extraordinary General Meeting (EGM) to remove Goenka and include six independent directors on the Zee board. Soon after, the broadcaster struck a merger deal with Sony. The deal, currently pending regulatory and shareholder approval, gives Zee 47% in the combined entity and puts Goenka in the driver’s seat.
Although Invesco supported the merger from day one, it was against certain conditions that favored Goenka and his family at the expense of common shareholders. After Zee rejected Invesco’s EGM request, the US fund was in a legal battle with the broadcaster. On March 21, 2022, it had won the Bombay High Court, where a two-judge bench allowed the EGM to proceed.
Bombay HC order expected to be challenged Supreme court g by the management and promoters. But two weeks ago, Invesco decided not to pursue the EGM request.