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Zee Entertainment's Shares Plummet as Company Confirms Insolvency Proceedings

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Zee Entertainment (NS:ZEE) experienced a nearly 9% decline in trading on Thursday following the company's admission to insolvency proceedings. 

Zee Entertainment was trading at Rs 187.60 on the BSE, a decrease of 8.89% in noon trade, and its stock is currently at a 52-week low.

According to a stock exchange filing by Zee Entertainment, the National Company Law Tribunal, Mumbai Bench (NCLT), has admitted the company to corporate insolvency resolution process under the provisions of the Code, in response to a petition filed by Indusind Bank Ltd. 

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The Insolvency & Bankruptcy Code, 2016, Section 7, in favour of the company.

Currently, Zee owes 90% of its secured debt to two major secured creditors, HDFC Bank Ltd. and Kotak Mahindra Bank Ltd. 

However, the debt is relatively minor, totaling less than Rs 33 crore as of December 31, 2021. The merger application is currently in the second stage before the NCLT, which will be taken up on March 9th. In this stage, the court will decide the date for the final hearing.

During the last hearing, the court was unable to proceed with the process due to objections from major creditors of Zee, including Axis Finance Ltd., IndusInd Bank Ltd., IDBI Bank Ltd., and IPRS. 

Despite this, all necessary regulatory approvals for the merger, including the approval of the Competition Commission of India, have been granted Zee Entertainment Share Price.

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