Sony says it’s taking Sebi allegations against Zee promoters ‘seriously’

Sony Pictures Entertainment said on Wednesday it takes allegations made by India’s market regulator against promoters of Zee Entertainment “seriously” and it is monitoring the situation.

Japan’s Sony was reacting to an order by the Securities and Exchange Board of India (Sebi) last week asking Zee CEO Punit Goenka and founder Subhash Chandra to step down from any director’s position. It alleged siphoning off of funds at Zee Entertainment. Goenka and Chandra, his father, have denied the allegation and moved the Securities and Appellate Tribunal (SAT) asking it to stay the order.

“There have been several erroneous press reports recently speculating about the future of ZEE’s planned merger with SPNI following SEBI’s interim order against Subhash Chandra and Punit Goenka. We take very seriously the SEBI interim order and will continue to monitor developments that may affect the deal,” said Sony in a statement issued in Culver City, US, referring to a proposed merger of Zee Entertainment with the local unit of the international media giant.

Sebi, in its affidavit to SAT, submitted that it found overlapping entities involved in the siphoning of funds and glaring irregularities. While justifying its action in the matter, Sebi submitted that it was done to safeguard the management and protect investors and other stakeholders and to prevent further possible mischief of tampering with the securities market.

Sebi also submitted that the appellants had not produced any material to indicate that they have suffered any prejudice by not getting a personal hearing before the interim order was passed. The regulator has said it is willing to give immediate hearing to the appellants “as early as required.”