On Monday, Zee Entertainment Enterprises announced that it forms an interim committee to handle operations. This comes after former Chairman Subhash Chandra and current CEO Punit Goenka were unable to reverse a restriction on them holding board positions imposed by the market regulator.
According to a representative for the corporation, the board of directors will act as the overseer for the interim committee.
According to allegations made by the Securities and Exchange Board of India in June, Chandra and Goenka were actively involved in the process of diverting cash to the group’s other listed corporations and enterprises associated to initial shareholders. As a result, the board barred them from holding board posts in publicly listed companies for a period of one year.
The Security Appellate Tribunal did not identify any illegality or irrationality in the order that was issued by SEBI, and it stated that it did not see any need to interfere because it did not believe that there was any justification for doing so. This decision was made one week ago.
It commanded SEBI to issue a final order by the middle of the following month and requested that Chandra and Goenka present their case in front of the regulatory body.
This verdict comes at a time when ZEE and an India affiliate of Japan’s Sony Group (6758.T) are getting closer to completing a merger that was announced in 2021 to form a $10 billion TV venture. Goenka is scheduled to become the managing director and CEO of the merged entity after the merger is completed.
Zee forms interim committee after the announcement on Monday, ZEE’s stock ended the day with a 6.3% gain.