Invesco wins battle, and half the war, at Zee

A guard stands next to a banner of Zee television outside a film studio in Mumbai, India, September 24, 2021. REUTERS/Francis Mascarenhas

MUMBAI, March 25 (Reuters Breakingviews) - After winning an Indian court battle to uphold its right to call a shareholder vote at broadcaster Zee Entertainment (ZEE.NS), Invesco (IVZ.N) has decided against wielding its 18% stake to hold a ballot. Originally, the U.S. fund manager wanted to oust boss Punit Goenka. That’s now redundant after Zee agreed to a $7 billion merger with Sony Pictures Networks India that will rejig the board and help to check the influence of the media tycoon. Invesco did well to get this far. Stepping back increases the chance the Sony deal to create a media powerhouse will get completed.

A first-time activist, Invesco’s initial intervention was clumsy, coming only after its push for an alternative union with part of Mukesh Ambani’s Reliance Industries (RELI.NS) failed. Zee rejected the fund’s demands, taking the standoff into court for an important wider test of shareholder rights. A 17% jump in Zee shares on Thursday underscores relief all around that Invesco is ready to stand down; overall the stock is 63% above its undisturbed price from September. A solid result for Indian corporate governance, and not bad for Invesco. (By Una Galani)

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(The author is a Reuters Breakingviews columnist. The opinions expressed are their own.)

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