Mumbai: Zee Entertainment Enterprises has filed a settlement application with capital market regulator Securities and Exchange Board of India (SEBI) to resolve ongoing investigations into alleged corporate governance lapses and financial irregularities.
The market regulator probe largely focused on Zee promoter family, including its managing director and CEO Punit Goenka and chairman emeritus Subhash Chandra for alleged diverting company funds and engaging in undisclosed related-party transactions.
Punit Goenka had obtained relief from the securities appellate tribunal (SAT) allowing him to continue as MD and CEO of the company while Subhash Chandra has challenged the SEBI order before SAT.
Last year SEBI had issued interim and confirmatory orders that barred the father-son duo from holding key positions in any listed company, including Zee Entertainment Enterprises.
The probe into Zee began after concerns were raised over corporate governance issues, financial mismanagement, and potential securities law violations.
According to senior SEBI officials, the Indian entertainment conglomerate wants to close the probe by paying a fine and taking corrective actions to maintain investor confidence without admitting or denying the allegations.
“It is part of a process under SEBI settlement regulations which allow companies to reach an agreement with the regulator. It involves paying a fine and taking corrective actions in exchange for closing the probe,” explained the regulatory official.
The settlement letter filed by Zee Group was advised by the board for settling any pending adjudication proceedings with the market regulator prioritising the interests of shareholders and stakeholders.
Zee has claimed the settlement was being made in order to bring closure to apprehensions raised in interim order, summons and various communications and to repose the faith of the investors. “It has been decided by the board to file the present settlement application for cordial resolution,” said Zee spokesperson.
