MUMBAI: Finally passing all the hurdles, Subhash Chandra-promoted Zee Entertainment Enterprises Limited (Zeel) announced to the BSE that the company has finally got the Bombay High Court nod for the ‘Scheme of Arrangement between Diligent Media Corporation Limited (DMCL) and the Company and their respective shareholders and creditors, for demerger of Media Business Undertaking (MBU) of DMCL’.

The undertaking comprises media and entertainment business, event management activities, TV channel license and TV reality show formats for game based shows. Through this business, Zeel is planning to give an impetus to its event management capabilities. Planned are events and game shows.

The scheme looks at the demerger of the MBU from DMCL and then vesting it with Zeel. Equity shareholders of DMCL will be given preference shares by Zeel in the ratio of one preference share of Re 1 of Zeel for every four equity shares of Rs 10 each held in DMCL. The company says that 2.23 crore preference shares shall be issued in all.

DMCL was formed in 2005 with a 50:50 JV between Essel Group and Dainik Bhaskar Corp (DB). In 2012, Essel Group bought out DB’s 50 per cent.

The entire DMCL is now under the two arms of Essel - Zee Media with DNA and Zee Entertainment with the MBU.

Zeel was also recently included in the 50-share CNX Nifty index replacing Diageo-controlled United Spirits. The network has been included in the recently launched CNX Media Index on the NSE and carried the maximum weight of 45.45 per cent in the index that comprises 15 media and entertainment stocks.

Reacting to the news, the share price of Zeel rose to 285.25 during trading on 12 September and closed on 283.75