The Subhash Chandra-backed multi-faceted Essel Group has received a three-month window from lenders and creditors, media reports said.
The company got a three-month breather from lenders and creditors to find a buyer for half of promoter and chairman Subhash Chandra's stake in the flagship Zee Entertainment Entreprises, a report in The Economic Times said.
In a press statement issued on Sunday, the company had said it has successfully arrived at an understanding with lenders having pledge on shares held by the promoters.
The promoters and lenders have agreed that the latter will ensure there is no default due to the steep fall in share prices of the company, the ET report said.
On Friday, shares of Zee Entertainment and Zee Learn suffered the biggest single-day loss since listing. Zee Entertainment fell over 26 percent while shares of Zee Learn lost over 18 percent.
According to a statement from Essel Group, there will not be any event of default declared due to the steep fall in price. "As a result, there will be synergy and co-operation, amongst lenders leading to a unified approach. Lenders drew comfort from reiteration by the promoters for a speedy resolution through a strategic sale in a time-bound manner," the statement from the company said.
As of 31 December 2018, ZEE promoters owned 41.62 percent shares in the company of which 59.37 percent are pledged with lenders.
Speaking on this development, Subhash Chandra, Chairman of Essel Group, said, “I am pleased to share that we have achieved an understanding with lenders. We have always valued their immense trust and faith sown in us and the positive and progressive outcome of the meeting, is a true example of the same. I am very positive, that we will continue to take such positive steps in rising up from the current challenging times, with support of all stakeholders.”
A Balasubramanian, CEO, Aditya Birla Sun Life AMC said, “We have always believed in the intrinsic value of ZEE Entertainment and most above, the sheer value system with which its promoters function. I am very glad with the outcome of the meeting, which enabled us to arrive at a consensus, in the interest of all stakeholders.”
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Updated Date: Jan 28, 2019 10:07:02 IST