Zee Entertainment Enterprises Ltd’s Board of Directors on Wednesday approved raising of capital worth ₹2,300 crore to fund strategic and business initiatives. The move is reminiscent of Zee’s last year proposals that failed to win required shareholder confidence.
“The Board of Directors of the Company, at its meeting held June 10, has approved the raising of capital by the company of minimum ₹2,300 crore in one or more phases/tranches to fund the strategic and business initiatives. Further, the Board decided to deliberate further on options for raising funds,” said the company in its exxchange filing.
The capital approved is near similar to the issue of convertible warrants worth ₹2,237.4 crore proposed by Zee to its promoters on a preferential basis. This proposal was, however, rejected by investors as the special resolution failed to get the requisite majority of 75 per cent votes in favour.
According to Shriram Subramanian, Founder, InGovern Research, the form of the capital raise will be watched keenly by investors as the details are yet to be announced.
When asked whether shareholder sentiment may have changed Subramanian said, “The company needs to detail the instrument, pricing and subscribers and the need for the capital raise while putting the matter before shareholders to vote. Since the promoter and management remain the same, the sentiment of institutional investors is unlikely to have changed since last year when a fund raise proposal by issuing warrants to promoters was defeated in a shareholder vote.”
The move comes close on the heels of Zee’s media announcements around FIFA World Cup 2026. The company acquired the media rights to 39 global football event at a reported valuation of under $60 million, lower than ₹450 crore paid by Viacom 18/Reliance media previously, raising questions about the property’s potential in providing a worthy payback.