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Zee's plan to raise Rs 2,000 crore gets board's approval

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Mumbai: The board of Zee Entertainment Enterprises has approved a proposal to raise up to ₹2,000 crore by issuing equity shares and/or convertible or non-convertible securities as the media conglomerate looks to bolster its balance sheet after the failure of a merger with Sony Pictures Networks India.

In a regulatory filing on Thursday, the company said the fundraising will give strategic flexibility to pursue future growth opportunities in the evolving media landscape. The fundraise will happen through permissible modes in one or more tranches, including but not limited to a private placement, a qualified institution placement, a preferential issue, or any other method or combination of methods, the company said, adding the fundraise is subject to regulatory approvals.

It added the fundraise will not exceed ₹2,000 crore, which is roughly 14% of company’s market cap. Zee first announced the fundraising plan on June 3. Elara Capital senior vice-president Karan Taurani said the fundraising will boost investor confidence, which has been low ever since the merger with Sony Pictures was called off in January this year.

“We expect that the cash infusion could lead to improved investor confidence and sentiment and business expansion and investments, given the increased competitive intensity in the sector following the RIL-Disney deal,” he said. Zee has ₹1,200 crore in cash and cash equivalents as of March-end.

Since the collapse of the merger deal with Sony, Zee restructured its business, with CEO Punit Goenka taking direct charge of the domestic broadcast vertical. It has also trimmed 15% of its staff across functions, besides sacking half of the workforce at its tech centre in Bengaluru. The company, whose profit margins have taken a hit in recent years due to accelerated spending on the streaming business, is eyeing an Ebitda margin of 18-20% by FY26.”We expect steady margin improvement on overall restructuring and cost optimisation initiatives, lower losses in ZEE5, better growth prospects in advertising segment, and lower marketing and tech expenses,” Taurani said.

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Welcome to Sromplexport! We’re a company that helps people and businesses import and export products across different countries. Whether you’re looking to source products, manage logistics, or navigate customs regulations, we’ve got you covered. We’re based in Rajkot, Gujarat, India, and we’re committed to providing ethical and transparent service to our clients. We work with industries like textiles, agriculture, and handicrafts, and we’re always happy to build new relationships with people who want to succeed in the import/export world. Thanks for stopping by, and let us know how we can help you!

Sromplexport offers international trade services, including product sourcing, quality control, logistics, and customs clearance. Our ethical and transparent approach simplifies the import/export process for clients in various industries.