Business Market 11 Sep 2019 Zee starts repaying ...

Zee starts repaying mutual funds before deadline

DECCAN CHRONICLE. | ASHWIN J PUNNEN
Published Sep 11, 2019, 1:40 am IST
Updated Sep 11, 2019, 1:40 am IST
The payments were made ahead of the September 30 deadline that the Essel Group promoters made to the mutual funds to pay off the debt.
They said HDFC Mutual Fund received Rs 580 crore, or 50 per cent of its total exposure to the troubled group, while Aditya Birla Sun Life MF received about Rs 760 crore, or 49 per cent of the amount outstanding. ICICI Prudential MF received Rs 435 crore while Kotak MF got Rs 599 crore.
 They said HDFC Mutual Fund received Rs 580 crore, or 50 per cent of its total exposure to the troubled group, while Aditya Birla Sun Life MF received about Rs 760 crore, or 49 per cent of the amount outstanding. ICICI Prudential MF received Rs 435 crore while Kotak MF got Rs 599 crore.

Mumbai: The Zee group has started repaying its lenders, including mutual funds, ahead of the September 30 deadline, as a part of its efforts to pare a debt of Rs 11,000 crore.

Sources said mutual funds like Aditya Birla Sun Life MF, HDFC MF, ICICI Prudential MF, Kotak MF and ABSL MF have received between 45 and 60 per cent of the total outstanding dues.

 

They said HDFC Mutual Fund received Rs 580 crore, or 50 per cent of its total exposure to the troubled group, while Aditya Birla Sun Life MF received about Rs 760 crore, or 49 per cent of the amount outstanding. ICICI Prudential MF received Rs 435 crore while Kotak MF got Rs 599 crore.

The payments were made ahead of the September 30 deadline that the Essel Group promoters made to the mutual funds to pay off the debt.

This standstill agreement prevented the funds from selling the shares pledged by the group in the open market.
Following the agreement, several mutual funds, including Kotak MF and HDFC AMC, had suspended payouts in their fixed maturity plans.

Among the mutual funds, Aditya Birla MF has the highest exposure to the group worth Rs 2,500 crore. Others major funds that have exposure to the group are SBI MF and Franklin Templeton.

Fund houses have a total exposure of nearly Rs 6,300 crore to the group, with shares of companies such as Zee Entertain-ment, Dish TV and Essel Infrastructure as collateral.

The group ran into trouble as share prices of group companies plunged on reports that the promoters have pledged most of their stake with the lenders.

In January this year, Essel Group Chairman and media baron Subhash Chandra tried to salvage the situation by writing an open letter, expressing his apologies to the lenders for not being able to repay the debt, in which he promised to repay each and every person.

The group has been trying to mop up funds by selling stake in its flagship company Zee Entertainment.

Zee group raised Rs 4,200 crore by selling 11 per cent stake in Zee Entertainment to global fund Invesco Oppen-heimer last month. It was expected that Zee would pay around Rs 2,600 crore out of this to the mutual funds.

Analysts say there will be further stake sale up to 8-18 per cent in Zee Enterprises to mop up funds to pay off lenders.

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