In an order passed on Wednesday, the NCLT allowed IndusInd Bank’s plea to admit ZEEL under the Corporate Insolvency Resolution Process (CIRP). The tribunal appointed Sanjeev Kumar Jalan as the insolvency professional for the company.
“Mr. Punit Goenka has filed an appeal in the Hon’ble National Company Law Appellate Tribunal (NCLAT) today, seeking relief against the order passed by the Mumbai bench of the National Company Law Tribunal (NCLT),” a statement from the Office of Punit Goenka reads.
The statement further states that Goenka is taking all the necessary steps as per law, to protect the interests of all stakeholders of ZEEL and to achieve timely completion of the proposed merger with Culver Max Entertainment (Sony).
“Mr. Goenka firmly believes in the potential of the merger, to deliver immense value to all stakeholders. ZEE is a debt-free & financially strong company, and believes in value creation for its stakeholders,” the statement adds.
Apart from ZEEL, the bankruptcy court had also admitted Siti Networks for insolvency proceedings. The Mumbai bench of the NCLT has appointed Mohit Mehra as the resolution professional for Siti Networks.
The division bench of judicial member HV Subba Rao and technical member Madhu Sinha had also rejected ZEEL counsel’s oral request to stay the order for two weeks.
Legal experts say that the NCLT order might delay ZEEL’s merger deal with Sony.
“Once the company gets admitted, the powers of the board of directors stand superseded in relation to the corporate debtor (Zee Entertainment). The only way out for the original promoters is to settle the dues with the lender under 12 (A) for post-admission settlement. Unless and until this occurs, no scheme matters, including merger or amalgamation, will be possible,” said Prachiti Shah, managing partner of law firm Nanavati & Nanavati Advocates.
Srishti Ojha, the founder of the law firm Verist Law, said the merger will depend on ZEEL’s Committee of Creditors (CoC) which has to formulate the resolution plan and design the outcome of this process.
The two companies have already received conditional approval from the Competition Commission of India (CCI). The stock exchanges and the company’s shareholders have also approved the deal.
“The teams at both ends are focused on completing all the required legal and regulatory processes mandated as per law. Our focus remains on concluding these processes in the most appropriate and timely manner, and we stay committed to building a value-generating institution for all our stakeholders,” Goenka said during a recent earnings call.
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