By Aditya Raghunath
Investing.com — Zee Entertainment Enterprises Ltd. (NS:) shares moved up a whopping 40% on September 14 after news broke that its major investors called for an extraordinary general meeting (EGM).
The purpose of the EGM, called by the company’s largest shareholders Invesco Developing Markets Fund and OFI Global China Fund LLC, was to discuss the removal of MD and CEO Puneet Goenka along with a couple of other directors.
Zee stock closed at Rs 261.7, up 40.06% on September 14. A stock exchange filing showed that Rakesh Jhunjhunwala’s RARE Enterprises bought 50 lakh shares of Zee at Rs 220.44 each on the BSE. This represents 0.52% of the company. The move paid off immediately with the stock moving up Rs 41.26 and giving RARE a notional profit of Rs 20.63 crore in one day.
Bank of America (NYSE:) Securities Europe SA also acquired 48,65,513 equity shares in Zee at Rs 236.2 per share.
Zee shareholders have demanded the immediate removal of Goenka, Manish Chokhani and Ashok Kurien as directors of the firm. Chokhani and Kurien have resigned with immediate effect.
Shareholders have proposed the names of six new directors for the board: Surendra Singh Sirohi, Naina Krishna Murthy, Rohan Dhamija, Aruna Sharma, Srinivasa Rao Addepalli, and Gaurav Mehta.
Market analysts believe that the new directors would improve corporate governance in the company.