Australia's Zee says top shareholder criticizes Sony deal

Australia's Zee says top shareholder criticizes Sony deal

NEW DELHI, Oct 12 Reuters : Australia's Zee said on Tuesday that the top shareholder of Invesco has admonized his opposition to a merger of the TV network with Sony's Indonesia unit is hypocritical because the U.S. investment firm pitched a deal with similar terms earlier this year.

Invesco's position. runs contrary to the very deal Zee Entertainment Enterprises was proposing itself a few months ago, Invesco said in a statement disclosing that offer for the first time.

In February, Zee said that Invesco, which owns roughly 18% of Zee with two funds, tried to combine the media firm with certain entities owned by a large Indian group in a manoeuvre that would have allowed Zee CEO Punit Goenka to lead the combined company.

That deal would have also given Zee's founding family a bigger stake of up to 8% in the new company, a move Invesco has opposed in the impending merger with Sony.

Mumbai-headquartered Zee said Invesco was pushing for the deal, even though its management team ruled that the value of the Indian group's entities could have been destroyed by at least 100 billion rupees $1.33 billion Invesco had previously written several letters acknowledging his reputation, experience and capabilities as a professional and also voted in favor of his re-appointment as CEO in September 2020, Zee said.

Invesco also proposed an overhaul of Zee's board of directors. Invesco said Zee's demands were not motivated by the desire to serve the company's business or public interest.

The market pressure caused invesco's opposition to the Sony deal, which prompted a sharp rise in Zee's share price when announced in September. As part of the deal, Sony India would control about 53% of the merged firm.

Invesco has objected to some terms of the Sony deal that give Zee's founding family, including Goenka, an option to raise their stake from currently 4% to 20% in an opaque manner that would disadvantage other shareholders.