Zee Entertainment issues 20,94,47,805 convertible warrants to Sunbright Mauritius
Zee Entertainment (ZEEL) just handed out 20,94,47,805 convertible warrants to its promoter group, Sunbright Mauritius Investments Limited.
This means Sunbright can turn these warrants into regular shares later on, basically upping its stake in the company.
The deal wrapped up on August 21 after getting the green light from shareholders, the stock exchanges, and a favorable order from the Securities Appellate Tribunal (SAT).
Sunbright pays about ₹659.76cr upfront
Sunbright paid about ₹659.76 crore upfront (that is 25% of the total), with the rest due within 18 months of allotment i.e. by February 21, 2028.
Once all is done, Sunbright's stake in ZEEL will jump to approximately 17.90% on a fully diluted basis.
This comes as ZEEL faces heat from SEBI for pledging property without proper approvals, a move that got it into some regulatory trouble.
Thankfully, SAT gave ZEEL a little breathing room: it can go ahead with the warrant deal subject to deposit of full penalty within one week by both the appellants and does not use mutual fund investments for dividends.
Plus, SAT gave it an extra week past the original August 14 deadline to finish everything up.