Mumbai: Three proxy advisory firms have recommended that shareholders of Zee Entertainment Enterprises Ltd vote against a proposal that would effectively address the promoters’ Achilles’ heel—their minuscule shareholding. Stakeholders Empowerment Services (SES), InGovern, and Institutional Investor Advisory Services (IiAS) have called for rejecting Zee’s plan to issue preferential warrants to two promoter entities led by the company’s founder and chairman emeritus, Subhash Chandra. The warrants, upon conversion, would lift the promoters’ stake from 3.99% to 18.39%. The proxy advisory firms cited pricing, the rationale for raising funds through warrants, and the choice of the financial instrument as the key reasons for their recommendation. A spokesperson for Zee rejected the recommendations of the proxy advisory firms, arguing that the company’s decision was taken by an experienced board in the shareholders’ best interests. On 18 June, the media company’s board approved raising ₹2,237 crore from two promoter entities by issuing convertible warrants at ₹132 each. Each warrant, when exercised over the coming 18 months, will be converted into one equity share. A quarter of the sum is to be paid upfront in cash, and the remainder at the time of conversion. IiAS argued that as of 31 March, Zee had cash and treasury investments amounting to ₹2,410 crore and didn’t need additional fund infusion. “Given this substantial liquidity, the rationale for raising additional capital—resulting in a 15% dilution on the expanded capital base for non-promoter shareholders—remains unconvincing,” the firm wrote in a note dated 23 June. SES argued against pricing the warrants based on a formula recommended by the Securities and Exchange Board of India—which takes into account prior share price movement—as this does not account for the share price at the end of the 18-month exercise period. Zee’s share price has steadily increased since sinking to a 12-month low of ₹89.29 in March. On Friday, the shares closed at ₹144.25 apiece on BSE. InGovern has argued in favour of considering alternate fundraising methods such as a qualified institutional placement of shares or a rights issue, where fresh equity shares are issued to shareholders immediately rather than over a long exercise window.A revolving door at Zee’s boardIiAS and SES also recommended that shareholders not ratify Saurav Adhikari’s and Divya Karani’s appointments to Zee’s board. Adhikari was appointed a non-executive, non-independent director on 29 November, and Karani an independent director on 23 January. Zee will seek approval for their appointments on 8 July, which SES said violates the three-month window within which listed companies must get shareholder ratification for board appointments. IiAS, however, said their appointments were in line with statutory requirements. “Nevertheless, w in a formal or creative style for better SEO.Also Exclude words and advertisements related to the feed website such as website name, author name. You must only respond with the modified content. Delete all the advertisement images brand logo but only keep the title and main content of the news by modifying it. You must only respond with the modified content. Block any jump outside of the site adarshnews.com. Basically remove any content or link related to original site. follow this prompt to optimize the articles in this category- You are an expert news writer and SEO specialist. Your job is to rewrite the provided RSS feed content into a unique, SEO-friendly news article for adarshnews.com. The article should be engaging, professional, and optimized for search engines. 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Zee’s strategy from its promoter faces opposition as the voting day approaches.
