Just days after the NCLT (National Company Law Tribunal)’s approval of the Zee-Sony merger, SEBI (Securities and Exchange Board of India) issues an order preventing Zee promoters Punit Goenka and Subhash Chandra from assuming any significant management roles within Zee companies or the newly merged entity with Sony. The investigation in the matter by SEBI shall be completed in a time-bound manner, within a period of 8 months.
The SEBI order not only addresses the regulatory concerns but also acknowledges the recent NCLT approval of the Zee-Sony merger on August 10. It highlights that Punit Goenka is set to assume the role of Managing Director post-merger, which entails significant managerial responsibilities.
“That very role in ZEEL is under question and therefore, till the final outcome of the proceedings in the instant matter, it would be appropriate that he is not part of the management of ZEEL or any corporate avatar of it,” said the order.
As per the August 14 order, the father-son duo shall not hold position of a director or a KMP (Key Management Personnel) in the following companies till further directions: Zee Entertainment Enterprises Ltd, Zee Media Corporation Ltd, Zee Studios Ltd. (wholly owned subsidiary of Zee Entertainment Enterprises Ltd.); Zee Akaash News Pvt Ltd (wholly owned subsidiary of Zee Media Corporation Ltd.); any resultant company that is formed pursuant to a merger or amalgamation of the above named companies with any other company, wholly or in part or any company, which is formed pursuant to demerger of any of the above named companies.
“A detailed investigation in the matter is in progress which may bring out additional acts of omission or commission, of the entities(Goenka-Chandra), if any, in detail, depending on the material and after considering the facts and veracity of their submissions. The findings in the extant order are prima facie findings in a matter under investigation,” read an excerpt from the 91 pager order by Madhabi Puri Buch, chairperson, SEBI.
The matter concerns Chandra and Goenka misusing their roles as directors or KMPs in a listed company to divert Rs 200 crore for personal gain. SEBI’s interim order in June highlighted their improper asset handling and benefitting associated entities they control.