By Gopika Gopakumar, Varun Sood, Livemint, Mumbai
Reliance Industries Ltd on Wednesday stated differences between Zee Entertainment Enterprises Ltd’s managing director Punit Goenka and Invesco, the company’s single-largest shareholder, over how the Goenka household would elevate its stake within the broadcaster led to a collapse in merger talks with RIL’s media properties.
Mukesh Ambani-led RIL proposed to merge its media properties with Zee in February after Invesco helped organize discussions between Goenka and RIL’s representatives, the company stated in an announcement on Wednesday night, including that it regretted being dragged right into a dispute between Zee and the US funding agency.
The assertion got here after Invesco, earlier on Wednesday, stated Reliance had approached Zee for a merger.
A day earlier, Zee stated Goenka rejected a deal proposed by Invesco to merge Zee Entertainment with entities owned by an unnamed “large” Indian strategic group.
The flurry of statements come amid a bitter battle between Invesco and Zee’s founding household. Invesco is looking for to recast the board of Zee and oust Goenka, the son of Zee’s founder Subhash Chandra. Zee has challenged Invesco’s try to restructure the board in courts and alleged that the US investor is making an attempt to take over India’s largest publicly-traded broadcaster on the behest of one other company.
Apart from difficult Invesco in courts, Zee has additionally initiated merger talks with Sony Pictures Networks India.
In its assertion, Reliance stated differences arose between Goenka and Invesco over Zee’s founding household looking for to enhance its stake by subscribing to preferential warrants. “The investors (Invesco) seemed to be of the view that the founders could always increase their stake through market purchases,” Reliance stated.