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B4U to seek further clarification, sends legal notice to Essel Group

18-April-2001
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B4U to seek further clarification, sends legal notice to Essel Group

Ravi Gupta, CEO, B4U Multimedia said that in its earlier response to a legal notice, the Zee Group claimed it had forwarded funds to Ketan Parekh with the intention of buying stakes in media companies. Nowhere in their legal response have they claimed to have a 15 per cent ownership of B4U Multimedia," Gupta said. The response vindicated the B4U stand that Subhash Chandra’s move was predatory in nature.

Gupta said Parekh's current holding in B4U Multimedia was not more than 5 per cent. The company had divested around 8 per cent stake in December last year. None of the other promoter has divested their stake.

Subhash Chandra in a recent interview claimed to have invested about Rs 75 crore in ABCL for 28.5 per cent equity, and Rs 46 crore in B4U for a 15 per cent stake through stockbroker Ketan Parekh.

Zee later added that these stakes were taken by investment companies from the Essel Group. An amount of Rs 220 crore were lent by Zee Telefilms to the Essel Group for this purpose. The amount would be returned (along with interest) to Zee Telefilms by June 30, 2001.

Meanwhile, a senior AB Corp executive said the company would still go by its claim that it has not received any funds from any Zee Group firms for a stake in the former. "Therefore, the question of Zee having any stake in our company does not rise," Rajesh Yadav, finance, head, ABCL said.

Yadav said ABCL was still awaiting response from the Essel Group as to their claims of having taken a stake in the company. ABCL may consider sending a legal notice only after going through official response from the Zee Group, executives said.

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