In a relief to Zee Entertainment Enterprises (Zee) MD Punit Goenka, the National Company Law Appellate Tribunal (NCLAT) stayed insolvency proceedings against the media company.
IndusInd Bank, a financial creditor, was told to submit a response within two weeks, and Zee, a follow-up submission, was told to do the same. The NCLT is determined that the order issued by the Mumbai bench of the NCLT on February 22 is on hold until the matter is finally resolved, which was set for final disposition on March 29.
IndusInd had initiated insolvency proceedings against Zee after its sister-concern Siti Networks defaulted on a loan of £9.3 million. The media major was the guarantor for the loan. Last week, the NCLT had admitted IndusInd’s insolvency plea against Zee. Subsequently, Goenka in his personal capacity challenged the NCLT order.
The issue occurs when Zee and Sony Pictures Networks India (SPNI), now known as Culver Max Entertainment, are in the advanced phases of their merger. Analysts predict a delay even though Goenka anticipates the transaction to be completed on time.
Zee's stock initially recovered as a result of the NCLAT order, but the sluggish trend eventually dragged it down to a lower closing. The stock surged to an intraday high of Rs. 205, up 3%, before falling to Rs. 196, down 1.6%.