B4U Television Networks has said that the reported acquisition by Zee Network of a substantial block of B4U shares `secretly’ and without the formers knowledge amounted to a backdoor, hostile takeover bid by Zee Network. B4U plans to send a legal notice to Zee for not having intimated either the company or the regulatory authorities about this development.
Ravi Gupta, CEO of B4U said Zee’s public statement on Tuesday that it had acquired a 15 per cent stake in B4U’s equity through stock broker Ketan Parekh was the first he had heard about the deal. In a statement issued on Wednesday evening, Zee reiterated its earlier statement that it had acquired a 15 per cent stake in B4U.
When it was pointed out to Gupta that Zee had said it had acquired B4U’s equity from Ketan Parekh to whom Zee had lent money, he conceded that the stock broker did have a substantial holding in B4U through private placements. This, however, did not exceed five per cent, making it impossible for Zee to acquire a 15 per cent stake.
Gupta also revealed that B4U had not taken any decision to dilute the original shareholding pattern, and termed Zee’s bid as “violative of legal norms and “unethical”.
He also said the company would be pressing for regulatory action, but did not specify what steps it would be taking.
According to Gupta, B4U’s television and broadcasting business in India has been shifted to B4U Television Networks, in which Bharat Shah has no stake.
This company in turn is promoted by the B4U International Holdings in which only steel magnate L N Mittal, Gokul Binani and film distributor Kishore Lulla are partners, he said.