There has been a reshuffle of the board at Zee Entertainment Enterprises after Subhash Chandra resigned as chairman. There have also been new appointments as far as independent directors are concerned. Amit Tandon, MD of Institutional Investor Advisory Services (IiAS), and Shriram Subramanian, founder and MD of InGovern, discussed with CNBC-TV18 what the market makes of this reshuffle.
Tandon said he believes Zee Entertainment could have waited before announcing the board rejig. “Given the fact that all these changes happened in shareholding, the company could have waited for 4-6 weeks to absorb all this, have a meaningful dialogue with investors in terms of understanding what their expectations are before they went ahead and announced these changes,” Tandon added.
In a general way, the ex-Chairman should not continue on the board, because the board will naturally find it tough to go against decisions taken under the previous leadership, he said.
“One of the things which I have been disappointed by this change is that, given the fact that there is so much turmoil in the media sector and that other than Subhash Chandra and Punit, there is no one here who has current grounding in terms of what is happening in the media sector and what is changing,” he added.
Tandon believes the overhang of the promoter holding over Zee's board will continue.
Subramanian said Zee didn’t surprise with the changes that I have been telling media. “Definitely, there is a need for a change because the percentage holding of the promoters has come down. The width also of the board needs to increase because right now they have only 8 members,” Subramanian added.
He further said that we believe new appointees at Zee Entertainment lack specific skill sets. “The statement that they have put out saying that they will look for representation for somebody from the digital background. Therefore, one can expect an expansion of the board in the near future because they have explicitly stated that,” added Subramanian.