Glass Lewis recommends Zee shareholders to back promoter stake increase

In its report, Glass Lewis endorsed ZEEL’s proposal to issue up to 169.5 million convertible warrants on a preferential basis to promoter group entities

by e4m Staff
Published: Jul 7, 2025 5:08 PM | 2 min read

Leading independent global proxy advisory firm Glass Lewis has advised ZEE’s shareholders to vote for the resolution pertaining to the Company’s promoter stake enhancement.

In its report for the upcoming Special Meeting on July 10, 2025, Glass Lewis endorsed Zee Entertainment Enterprises Limited’s (ZEEL) proposal to issue up to 169.5 million convertible warrants on a preferential basis to promoter group entities, Sunbright Mauritius Investments Limited and Altilis Technologies Private Limited.

The proposed warrants, priced at ₹132 each, will be convertible into equity shares at a 1:1 ratio, potentially increasing the promoters’ stake by up to 17.7% of the company’s share capital. The initial payment of 25% will be made upfront, with the balance due within 18 months.

Glass Lewis noted that the issuance would dilute existing shareholders by approximately 15%, a level it considers reasonable. The proxy advisor highlighted that the pricing complies with SEBI regulations designed to protect shareholder interests, as it aligns with market pricing norms over recent trading periods.

Zee’s board has said the ₹22.37 billion capital infusion will help fund new business initiatives, bolster liquidity amid intense industry competition, and support potential strategic acquisitions to drive long-term growth.

Despite ZEEL’s recent underperformance—with a one-year total shareholder return of -28.4% compared to the FTSE India Index’s 3.6% gain—Glass Lewis found no material governance or valuation concerns to oppose the proposal.

The resolution requires approval from 75% of shareholders and will be voted on during the virtual-only EGM scheduled for July 10.