Television

Zee seeks to clean convergence adventure from balance sheet

MUMBAI: It is finally taking a hit in its balance sheet for its adventurous forays during the peak of the dot com and convergence craze.

Subhash Chandra's Zee Telefilms Ltd (ZTL) is planning to write off the value of ZTL's investment of Rs 614.5 million in its wholly owned subsidiaries, Econnect India Ltd (EIL) and Zee Interactive Learning Systems Ltd (ZILS).

Consequent to this, ZTL has proposed to effect a corresponding reduction in its reserves and surplus by Rs 612.2 million to Rs 34483.6 million.

Breakup of ZTL's investments in EIL and ZILS:

EIL    Rs 210 million (2,10,00,000 equity shares of Rs. 10/- each)

ZILS    Rs 404.5 million (19,26,413 equity shares of Rs. 10/- each at a premium of Rs. 200/- per share)

Investments written off by Rs 614.5 million.

Reserves and surplus reduced by Rs 612.2 million.

Zee has already got board approval for the same. Now it is seeking its shareholders nod too, through an extraordinary general meeting scheduled to be held on 8 August 2003.

The move comes in the wake of a major capital reduction in EIL and ZILS, both of which have incurred heavy losses. The company has admitted that the two companies' net worth has been totally eroded in its notice to shareholders.

While EIL has a paid up share capital of Rs 210 million, the net worth of ZILS is pegged at Rs 405.3 million comprising of paid up capital of Rs 20 million and Reserves and Surplus of Rs 385.3 million (on account of its shares being issued at a premium of Rs 200 each to ZTL).

The accumulated losses and outstanding miscellaneous expenses of the two subsidiaries as on 31 December 2002 are as given below:

Subsidiary    Accumulated losses    Miscellaneous expense not written off

EIL    163,957,067    43,397,962

ZILS    413,909,000    13,810,000

Under the proposal, the ZTL board says it wants to extinguish the losses of EIL by reducing its paid up equity share capital from Rs 210 million to Rs 2.6 million.

Similarly, ZILS will also undertake a capital reduction from Rs 20 million consisting of 2 million equity shares to Rs 500,000. The Rs 385.2 million which it got from its issue of shares to ZTL at a premium of Rs 200 per share will be shown as a credit in the balance sheet.

ZTL has said that the losses in Zils are on account of a general slowdown in the information technology business globally and those in EIL to a general slowdown in the dotcom business. This news comes in the aftermath of the dotcom slaughter, which left many Internet ventures in ruins. However, it should be noted here that regionally and globally, IT education, which was the mainstay of ZILS, was not greatly affected by the dotcom bust. Did the ZILS management follow an incorrect business model?

Despite the fact that Econnect has closed down a number of unremunerative channels on the portal and has been focusing on entertainment portals to supplement the business of its parent company ZTL, the company has not started making profits yet.

ZILS also has not been financially strong enough to generate profits even as recent efforts at non-performing operations and assets were discontinued. This despite the fact that ZILS has also closed down a number of loss making centers and has restructured the business to focus on the export of software and content development. 

It is pertinent to note though, that the Zee Group has been plugging its KidZee foray into pre-primary education on its television channels with a plan to roll out 100 centres through the franchising route. The kids education initiative is being charted through ZILS.

The Zee management says the current accounting exercise will not impact its ability to service its liability in respect of the paid up or unpaid share capital.

Market analysts say the markets have already factored in losses incurred by subsidiaries of Zee Telefilms and don't expect any reactions to the resultant capital reduction in ZTL. Following the write-off, the current assets position is expected to be more in line with Zee's present financial position.

(Figures have been approximated to one decimal place)

Latest Reads

http://www.indiantelevision.com/sites/drupal7.indiantelevision.co.in/files/styles/340x340/public/images/tv-images/2018/06/22/Nivedita-Oak.jpg?itok=75PAewjb
Times Television Network elevates Nivedita Oak to DGM

Times Television Network (TTN) has elevated Nivedita Oak to deputy general manager - influence. Earlier, Oak was the regional head for Zoom, FCT and branded content. She has been working with the Times Network for the last 11 years.

Television TV Channels People
http://www.indiantelevision.com/sites/drupal7.indiantelevision.co.in/files/styles/340x340/public/images/tv-images/2018/06/22/pathan.jpg?itok=tah626ME
History TV18 to release third film in ‘Special Operations India' series

History TV18, a pan-Indian television channel, is to create a documentary on counter-terrorist operation at Pathankot air base named Special Operations India: Pathankot. This one-hour documentary will be aired on June 25 at 9 pm.

Television TV Channels Factual & Documentary
http://www.indiantelevision.com/sites/drupal7.indiantelevision.co.in/files/styles/340x340/public/images/tv-images/2018/06/22/cnbc.jpg?itok=opviMAi9
CNBC-TV18 successfully concludes the 8th edition of the ‘India Healthcare and Wellness Awards 2018’

NBC-TV18, India’s leading English business news channel along with ICICI Lombard hosted the 8th edition of the ‘Indian Healthcare and Wellness Awards 2018’ at The Grand Hyatt, Mumbai.

Television TV Channels News Broadcasting
http://www.indiantelevision.com/sites/drupal7.indiantelevision.co.in/files/styles/340x340/public/images/tv-images/2018/06/22/mn.jpg?itok=QPriVkLO
MN+ to air Indian Television premier of ‘Tulip Fever’

MN+, the Gold Class of Hollywood Movies from the Times Network, brings to the viewers, for the first time on Indian television, the celebrated romantic historical saga– ‘Tulip Fever’. The movie will premiere on Sunday, 24th June at 1 pm and 9pm on MN+.

Television TV Channels English Entertainment
http://www.indiantelevision.com/sites/drupal7.indiantelevision.co.in/files/styles/340x340/public/images/tv-images/2018/06/22/india.jpg?itok=M2oqHiQO
Sony Music acquires the music rights for 2018’s much awaited sports drama film ‘SOORMA’

Global music giant, Sony Music has acquired the music rights for Soorma – the greatest comeback story of the hockey legend Sandeep Singh.

Television TV Channels Music and Youth
http://www.indiantelevision.com/sites/drupal7.indiantelevision.co.in/files/styles/340x340/public/images/tv-images/2018/06/22/vs.jpg?itok=pVjUI8CY
Epic and Rupa publications announce the umeed india book on the occasion of international olympic day

EPIC TV - India’s only Hindi language, Indian Infotainment channel celebrates International Olympic Day with an exclusive unveiling of the first look of the Umeed India book published by Rupa Publications and based on its popular series, of the same name hosted by ace cricketer Virender Sehwag.

Television TV Channels Factual & Documentary
http://www.indiantelevision.com/sites/drupal7.indiantelevision.co.in/files/styles/340x340/public/images/tv-images/2018/06/22/bbc.jpg?itok=gE0qxQNX
Iconic series Blue Planet II set for Indian TV premiere on Sony BBC Earth after a successful theatrical run

All eyes on TV as India’s #1 factual entertainment channel, Sony BBC Earth, premieres the world-renowned, path breaking and breath-taking series Blue Planet II for the Indian audience on June 25th at 9 pm.

Television TV Channels News Broadcasting
http://www.indiantelevision.com/sites/drupal7.indiantelevision.co.in/files/styles/340x340/public/images/tv-images/2018/06/22/fox.jpg?itok=tK9XckqM
FOX Life celebrates a perfect celebrity mismatch in Great Escape’s new season

He’s rugged, she’s delicate. He’s adventurous, and she is spiritual. They are two friends who, at a distance, might seem like polar opposites. But get closer and you are sure to be surprised. FOX Life, India’s favorite premium lifestyle channel,

Television TV Channels Factual & Documentary
http://www.indiantelevision.com/sites/drupal7.indiantelevision.co.in/files/styles/340x340/public/images/tv-images/2018/06/22/dev2.jpg?itok=LqKTXd3c
Engaging viewers with diversified content, COLORS brings you investigative thriller - Dev2

He thinks like a criminal, is at home around a crime scene and possesses an ironclad will to rid the city of nefarious wrongdoers; Detective Dev Burman returns for an explosive second season on COLORS – India’s premium Hindi entertainment channel.

Television TV Channels GECs

Latest News

Load More

Sign up for our Newsletter

subscribe for latest stories