Zee Group rushes to assure crucial lenders
28 January 2019
With a major crisis looming over Zee Entertainment Enterprises, Subhas Chandra the media baron who controls the Essel Group, rushed to defend the group with crucial lenders.
The company lost a whopping $1.6 billion of its market value on Friday after media reports of alleged irregularities. The hefty losses could derail Chandra’s plans to sell a stake in his group.
The Rajya Sabha MP said he had reached an understanding with the lenders. “We have always valued their immense trust and faith sown in us and the positive and progressive outcome of the meeting, is a true example of the same,” he said. “I am very positive, that we will continue to take such positive steps in rising up from the current challenging times, with support of all stakeholders.”
The company also informed stock exchanges that the management had reached an understanding with lenders having a pledge on the promoters’ stake that the sharp fall in the price of its shares would not lead to a default.
It had met the heads of non-bank lenders, investment officers of mutual funds and top bankers to allay their fears following the sharp fall in value of the shares.
Chandra in an open letter apologised to investors for the financial woes of the group and said it had been adversely impacted by the poor investments in the infrastructure sector and its exposure to Infrastructure Leasing and Financial Services.
Punit Goenka, Zee CEO, told investors that the share plunge would not affect Chandra’s plans to sell half his stake in the company.