Mumbai: The board of Zee Entertainment Enterprises has given its approval to raise ₹1,997 crore ($239 million) from Resonance Opportunities Fund, St. John’s Wood Fund Limited, and Ebisu Global Opportunities Fund by issuing foreign currency convertible bonds (FCCBs) on a private placement basis.
Regulatory Filing
In a regulatory filing, the company said it will issue unsecured, unlisted FCCBs, which will mature in 10 years, at a 5% coupon per year. The FCCBs will be split into 10 series, and the proceeds will be drawn in tranches, it added.
On conversion of FCCBs to equity, Zee will issue 1,240 million fully diluted equity shares of ₹1 each to the FCCB holders at the conversion price of ₹160.20 per equity share. The date of issuance of FCCBs was July 16, and the floor price was ₹152.45 per share. The dollar-to-rupee conversion rate has been fixed at ₹83.5658 per US dollar.
Analysts Prediction
Analysts say the fundraise will give Zee the much-needed capital to compete in the market, which is going through a consolidation phase.
Zee Entertainment Enterprises’ board has approved raising ₹1,997 crore ($239 million) by issuing foreign currency convertible bonds (FCCBs) to Resonance Opportunities Fund, St. John’s Wood Fund Limited, and Ebisu Global Opportunities Fund.
Unlisted FCCBs
According to a regulatory filing, Zee will issue unsecured, unlisted FCCBs maturing in 10 years with a 5% annual coupon. The FCCBs will be issued in 10 series, and funds will be drawn in phases.
When converted to equity, Zee will issue 1,240 million fully diluted equity shares of ₹1 each to the FCCB holders at a conversion price of ₹160.20 per share. The FCCBs were issued on July 16, with a floor price of ₹152.45 per share. The exchange rate is set at ₹83.5658 per US dollar.
Analysts believe this fundraise will provide Zee with the necessary capital to remain competitive during a market consolidation phase.
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