• News
  • Columns
  • Interviews
  • BW Communities
  • Events
  • BW TV
  • Subscribe to Print
  • Editorial Calendar 19-20
BW Businessworld

Respect All Founders, Never Resorted To Hostile Transactions: Reliance on Zee-Invesco row

Differences arose between Punit Goenka and Invesco with respect to a requirement of the founding family for increasing their stake by subscribing to preferential warrants, Reliance said

Photo Credit :


Amid the war of words between ZEEL and the company's single largest investor, Invesco, Reliance Industries has issued a statement saying that it has been unnecessarily drawn into the boardroom battle between the two companies. The company also said that the merger deal between its media properties and ZEEL could not proceed further due to differences between ZEEL promoters and Invesco.

“We regret our being drawn into the dispute between Zee and Invesco. The reports in the media are not accurate. In February/ March 2021, Invesco assisted Reliance in arranging discussions directly between our representatives and Mr Punit Goenka, member of the founder family and Managing Director of Zee,” Reliance said in a statement.

The company further stated that it had made a broad proposal for merger of its media properties with Zee at fair valuations of Zee and all its properties. “The valuations of Zee and our properties were arrived at based on the same parameters. The proposal sought to harness the strengths of all the merging entities and would have helped to create substantial value for all, including the shareholders of Zee,” the statement added.

Reliance, the statement said, always endeavours to continue with the existing management of the investee companies and reward them for their performance. “Accordingly, the proposal included continuation of Mr Goenka as Managing Director and issue of ESOPs to management, including Mr Goenka,” it stated.

The statement also noted that differences had cropped up between Punit Goenka and Invesco with respect to a requirement of the founding family for increasing their stake by subscribing to preferential warrants, due to which the deal did not proceed further. “The investors seemed to be of the view that the founders could always increase their stake through market purchases.  At Reliance, we respect all founders and have never resorted to any hostile transactions. So, we did not proceed further,” the statement reads.

Earlier today, Invesco had made a public statement saying that Reliance Industries had made an offer to merge some of its media business with ZEEL. On Tuesday, ZEEL had issued a statement saying that Invesco had facilitated a merger deal between a large Indian group and ZEEL without disclosing any names.

“We wish to make clear that the potential transaction proposed by Reliance (the Strategic Group) referenced but not disclosed in the 12 October 2021 communication by Zee) was negotiated by and between Reliance and Mr. Goenka and others associated with Zee’s promoter family,” said a spokesperson for Invesco on Wednesday. “The role of Invesco, as Zee’s single largest shareholder, was to help facilitate that potential transaction and nothing more.”

Hitting back at Invesco's open letter dated 11th October to shareholders, ZEEL had alleged that the American investment fund was calling for his removal since he had rebuffed a deal with Reliance. Subsequently, ZEEL had announced a merger deal with Sony Pictures Networks India (SPNI) in which the latter would hold a majority stake.

As per the deal that was facilitated by Invesco, ZEEL shareholders would have held 40% in the merged entity while Reliance would have controlled 60% following a cash infusion of Rs 14,000 crore in the merged entity. “The value of entities owned by the Strategic Group was considered at - INR 17,500 Crores; the Strategic Group would infuse approx. INR.14,000 crores of cash into the Merged Entity, pursuant to which the shareholding of the Strategic Group in the Merged Entity would increase to approx. 60%,” the Board Note issued by ZEEL stated.

“I was to continue as the MD and CEO of the Merged Entity; the promoter group of the Company would be given 3.99% shareholding of the Merged Entity; and I was further offered employee stock options (ESOPs) representing up to 4% of the shareholding of the Merged Entity. Accordingly, the existing promoter group of the Company would hold up to 7-8% in the Merged Entity.”

In a letter dated 11th October, Justin Leverenz, chief investment officer of Invesco Developing Markets Equities, had said that Zee’s potential does not stop at it being a well-governed stand-alone entity, and that it has welcomed the announcement of the non-binding term sheet reflecting Sony’s interest in a strategic alignment with Zee. “We need more information to properly evaluate a strategic combination between Zee and Sony. However, there are two known items from the announcement that have raised significant concerns,” Justin had noted.

(This article has been originally published in

Tags assigned to this article:
reliance industries zee media