InvestorQ : Do you see any major concerns in the Zee deal at this point of time?
Tisha Malhotra made post

Do you see any major concerns in the Zee deal at this point of time?

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Moii Chavate answered.
2 years ago
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Actually, there are two concerns that you must be aware of at this point of time. Firstly, it is not very clear if the numbers add up. For example, the deal with INVESCO has been struck at around Rs.400 per share so the 11% stake sale will help Subhash Chandra to raise nearly Rs.4224 crore. You will recollect that the Zee promoters had originally planned to sell 20% by September but they have apparently managed to get buying interest to the tune of 11% only. It could either be an appetite issue or it could be a valuation issue and both are not good news. You still have a huge shortfall. The promoter debt via pledges is currently at Rs.13,000 crore of which Rs.7,000 crore is payable to mutual funds by September as part of the standstill agreement. It is not clear whether banks will allow Zee to prioritize mutual funds over banks. This remains a very sticky issue and could snowball into a crisis in the days to come.

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