Investment firm Invesco Developing Market Funds has
decided to sell its stake in Zee Entertainment Enterprises Limited (ZEEL) for
as much as Rs 2,171 crore via a block deal tomorrow, according to CNBC-TV18 report. Until now, Invesco was
locked in a boardroom battle with Zee Entertainment.

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Currently, Invesco is Zee’s largest shareholder and owns
a total of 17.88% stake along with OFI Global China Fund LLC. It will offload
up to 7.8% of the equity. It will be selling 7.4 crore shares worth around Rs
2,200 crore, according to a CNBC TV18 report.

The shares are being offered between Rs 270 – Rs 290 per
share, representing a 7% discount from the current market piece. Kotak Mahindra
bank will be the banker for the block deal.

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Upon completion of the transaction, funds managed by
Invesco’s Developing Markets investment team, including Invesco Developing
Markets Fund, will continue to own at least 11% of ZEEL, highlighting the investment
team’s belief that the Sony deal in its current form has great potential for
Zee shareholders.

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The development comes within two weeks of Invesco
dropping its demand for an extraordinary general meeting (EGM), which it was
pursuing since September 2021 to push for changes on the Zee board. Through the
EGM, they had also demanded the removal of the company’s managing director
Punit Goenka.

Invesco issued a statement on March 23, which said it has decided not to pursue the demand for EGM to add six independent directors as Zee’s merger with Sony is achieving the fund’s aim of strengthening board oversight. In response to
the news, Zee’s stock surged by over 16% in the morning session on March 24.

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“Since we announced our intention to requisition, Zee has
entered into a merger agreement with Sony. We continue to believe this deal in
its current form has great potential for Zee shareholders. We also recognise
that, following the merger, the board of the newly combined company will be
substantially reconstituted, which will achieve our objective of strengthening
board oversight of the company,” Invesco had said. 

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Invesco added it will continue to monitor the
merger’s progress and if the merger does not progress as proposed, the fund retains
the right to request a fresh EGM.