Zee Telefilms unveils share allotment plan on demerger

Our Corporate Bureau
13 December 2006

Zee Telefilms Ltd (ZTL) has clarified the modalities of the restructuring of its news business and cable business for the benefit of its shareholders.

Subhash Chandra, chairman, stated, "In keeping with its philosophy of building long term shareholder value, the board of Zee had decided to restructure the various businesses. This would strengthen long term business prospects of each individual business, by providing focused management attention. From December 18, the company would start trading as the demerged entity (to be renamed Zee Entertainment Enterprises Ltd) and two new companies would start their journey as independently listed entities. Though the business of both Wire & Wireless India Ltd (WWIL) and Zee News Ltd (ZNL) was earlier part of the company, they would be able to unlock greater shareholder value as independent companies."

Zee Telefilms scheme of demerger

The scheme of arrangement had proposed demerging assets and liabilities of the following businesses:

• Cable distribution undertaking;
• News and regional broadcasting undertaking;
• Direct consumer business undertaking.

The date for the demerger is March 31, 2006, for the cable undertaking and the news and regional undertaking, while for the direct consumer business, the appointed date is April 1, 2006.

The company has already received approval of its demerger scheme by the Bombay High Court for the demerger of the cable undertaking and news and regional undertaking. The process of getting approval for the demerger of direct consumer undertaking is underway and is expected soon.