A day after asking Zee Entertainment Enterprises Limited (ZEEL) to hold an extraordinary general meeting sought by shareholders Invesco Developing Markets Fund and OFI Global China, the Bombay High Court on Friday reserved its order in the matter and will pronounce it on October 26.
At the hearing, OFI Global China Fund’s counsel Janak Dwarkadas argued that for shareholders to convene an EGM, they must hold 1/10 of the equity share capital of the company.
“It’s my right as a shareholder to call for the EGM,” said OFI Global China Fund, which along with Invesco holds 17.88 percent in Zee.
There is no violation of the Competition Act with the requisition to call an EGM, the investor said, adding that it is highly premature for the courts to be bothered in the matter.
Zee and its shareholders Invesco and OFI Global China have been engaged in a tussle since September at multiple forums, including the Bombay High Court, National Company Law Tribunal (NCLT) and the National Company Law Appellate Tribunal.
This is against the backdrop of the two investors’ requisition to hold an EGM seeking the removal of Managing Director Punit Goenka. However, Zee failed to call the meeting and had approached the Bombay HC requesting it to declare the EGM requisition notice ‘illegal and invalid.’
At the hearing today, Zee argued that the matter for consideration should be valid and legal and that there is no concept of an independent director being directly proposed. The board of listed companies should have an optimum balance of executive and non-executive directors, the media firm said.
“There should be a public offer if there is a change in control of the board,” Zee said, adding that prior permission from the Ministry of Information and Broadcasting is required before effecting any change to the board.
Moreover, Kapil Sibal representing Goenka said if the latter is removed, there would be no MD and CEO at Zee and there can’t be a board of directors without anyone in these top roles.
On Thursday, the court had asked Zee to hold the EGM, which would be chaired by a retired judge and its resolution is to be kept in abeyance till the Bombay HC decides on the legality and validity of EGM requisition. It added that the EGM resolution will be subject to the approval of the Ministry of Information and Broadcasting.
Zee is expected to announce the date of the EGM today.
(Edited by : Kanishka Sarkar)
First Published: Oct 22, 2021 2:56 PM IST
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