InvestorQ : What are the prospects that Zee group promoters would be able to resolve the debt crisis before the end of September?
Aashna Tripathi made post

What are the prospects that Zee group promoters would be able to resolve the debt crisis before the end of September?

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Moii Chavate answered.
2 years ago
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At this point it is very hard to say. You will recollect that a little over a month ago, the promoters had sold 11% stake in Zee Entertainment for Rs.4200 crore. These funds have now been used to repay part of the debt owed to the mutual funds in the first round. This stake was lower than the 11% that the promoters were originally planning to sell. However that did not work out. Even if the balance stake is sold, it would still only reach 50% of the debt target. The group also plans to sell solar plants and other infrastructure projects invested in.

The bigger question is what are the options before the group before the end of September? It is hard to really work out how the group will manage the rest of the amount by end of September, when the standstill deal comes to an end. There are two options if the balance is not managed by end of September. Firstly, Essel could negotiate for another extension, which is what looks more likely at this point. Secondly, MFs can sell shares in the market to make good the balance loss. But that would mean a sharp fall in price of the stock and losses to fund holders anyways. Either ways, it will not be an easy decision.

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