In response to a recent Bloomberg report alleging a significant 'accounting hole' amounting to $240 million in Zee Entertainment's financial records, the company swiftly dismissed the claims as incorrect and false.
A spokesperson for Zee Entertainment refuted the allegations, stating, "The reports and rumours pertaining to accounting issues in the company are incorrect and false. Pursuant to the SAT order, which granted relief to the current Key Managerial Personnel (KMP), the Company has been in the process of providing all the comments, information or explanation requested by SEBI, and has extended complete co-operation on all aspects.” a Zee spokesperson said. Meanwhile, Zee Entertainment shares plummeted over 10% during early trade today.
What did the Bloomberg report say?
The Securities and Exchange Board of India has found a financial discrepancy exceeding $241.36 million within the accounts of Zee Entertainment Enterprises reported Bloomberg News on Wednesday, citing informed sources.
SEBI had previously indicated suspicions regarding the involvement of Zee Group's key figures, Chairman Subhash Chandra and CEO Puneet Goenka, in channelling company funds towards other entities affiliated with the group. Chandra and Goenka have vehemently refuted these allegations.
The amount flagged by SEBI far surpasses initial estimations, reportedly amounting to nearly ten times the earlier figures. However, this sum remains subject to potential adjustments pending further review of responses from Zee's executives.
Zee- Sony merger
In recent developments, Japan's Sony Group recently terminated a proposed merger worth 10 billion with Zee, citing unresolved "closing conditions" and leadership disputes, particularly concerning Goenka's regulatory involvements.
Despite reports suggesting Zee's efforts to rekindle talks with Sony to salvage the deal, the company firmly denied engaging in any such negotiations in a recent exchange filing.
Earlier in October, an Indian tribunal lifted restrictions barring Goenka from holding board positions, signalling a legal milestone for the embattled CEO.
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