Zee Entertainment Manages To Dodge Another Insolvency Bullet

Zee Entertainment Enterprises Ltd. managed to avoid the insolvency petition of Indian Performing Right Society Ltd. (IPRS) after the company mutually settled all disputes and claims with its operational creditor.

The company and IPRS have mutually entered into the settlement agreement today on such agreed terms by which all disputes and claims have been settled between parties, the Indian media and entertainment company said in a stock exchange announcement.

IPRS, a representative body of owners of music, has agreed to withdraw its insolvency petition against the company, it added.

IPRS had filed a petition to initiate insolvency resolution against Zee, claiming a debt and default of over 211.42 crore rupees ($25.87 million) toward royalty payable for utilization of “literary and musical works.”

The body, which looks after copyrights for authors, composers and publishers of music, filed the petition before the Mumbai bench of the National Company Law Tribunal (NCLT) under Section 9 of the Insolvency and Bankruptcy Code 2016.

Zee today said the settlement terms are as per the settlement agreement entered into by the company and IPRS. There is no penalty paid and no material impact on the financial position of the company, it added, without disclosing the financial details.

The development comes within two weeks after Zee received some respite in another insolvency case against the company.

The NCLT on 22 February had admitted an insolvency resolution petition against Zee following an application by the company’s financial creditor IndusInd Bank. The tribunal also appointed Sanjeev Kumar Jalan, who looks after the restructuring practice at BDO India, as an interim resolution professional of the company.

However, Zee’s Managing Director & Chief Executive Officer Punit Goenka later managed to get a temporary stay on the NCLT’s insolvency order after filing an application before the National Company Law Appellate Tribunal (NCLAT).

The NCLAT is scheduled to hear the matter on 29 March.

(Note: $1 = 81.7347 Indian rupees)

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