The Subhash Chandra-promoted Essel Group is still in the race to acquire the management control of newswire agency United News of India as the Delhi High Court on Wednesday stayed the recent order of the Company Law Board that held the transfer of unsubscribed shares of UNI to Media Vest, an Essel Group company, `null and void' citing lack of transparency adopted by the UNI board.
"The Delhi HC today also allowed our four nominees as additional directors on the UNI board to continue participating in the UNI board meetings without the right to vote. But for any major decision regarding UNI's future, we will have to approach the honourable Delhi High Court till the matter is settled," A Mohan, Essel Group's Executive Vice President and Head of corporate affairs told Business Standard.
Media Vest was represented by its counsel Harish Salve. Anand Bazaar Patrika and The Hindu Group were respondents in the case. The Delhi HC will hold the next hearing on March 17.
Media Vest, the Essel Group Company, would continue to hold 51 per cent stake in UNI that it acquired in 2006 after paying the UNI board Rs 32 crore (Rs 320 million), Mohan added.
Apart from the Essel Group that owns Zee channels, other media companies such as Gujarat Samachar and Sandhya Prakash had also showed their interest in acquiring the management control of UNI in 2006.
Delhi HC also said on Wednesday that the Rs 32 crore (Rs 320 million) paid by Media Vest to UNI would remain with the UNI board and can be utilised for the benefit of UNI if the board felt so, according to a senior Essel Group lawyer.
Earlier this month, the CLB had held the transfer of unsubscribed shares of news agency UNI to Media West `null and void' on the grounds that the deal lacked transparency.
The CLB had also asked the UNI to repay Rs 27 crore (Rs 270 million) to Media Vest kept as fixed deposit immediately, and repay the Rs 5 crore (Rs 50 million) already utilised at the earliest.
The Essel Group had made a bid for UNI in 2006 to turnaround the newswire agency from a loss-making one to an agency of international repute. According to industry sources, UNI loses about Rs 30-40 lakh (Rs 3-4 million) a month.
