The board of Zee Entertainment Enterprises Ltd has institutionalised a structured Monthly Management Mentorship (3M) Program, said the media firm in a stock exchange filing on March 26.
The objective of the 3M Program is to guide and enable the management team to achieve key performance metrics, including the targeted 20% EBITDA margin, proposed by the MD & CEO, said Zee.
On March 26, Zee's shares were trading 2% lower at Rs 139.6 apiece.
This step, led by Zee Chairman, R Gopalan, underscores the board's unwavering commitment towards delivering higher value to all stakeholders, said the firm.
In order to drive the 3M Program, the Board has formed a Special Committee to review the management’s business performance and provide the required directional guidance.
The Special Committee comprises of Zee Chairman, R Gopalan and Uttam Prakash Agarwal, Chairman of the Audit Committee.
The 3M Program Special Committee has conducted the first set of extensive review sessions with the management to evaluate business vertical plans, enhance the revenue generation approach and optimise resource utilisation for improved efficiencies across the company, said Zee.
Gopalan, speaking after the completion of the first phase of the 3M Program, said: “After completing a detailed set of 33 meetings with various business verticals, corporate functions and leaders of the management team; our confidence and belief in the potential of the Company to deliver the targeted results, has certainly strengthened. Under the able leadership of Punit Goenka as the MD & CEO of the Company, the businesses are well-aligned and focused towards the set goals for the future. Leveraging the external lens and an outside-in perspective, the Committee has provided its independent, neutral and fresh views to the business leaders enabling them to further improve their efficiency and performance. The board has also advised the MD & CEO to further simplify the management structure and optimize the utilisation of the human capital.”
The 3M Program Special Committee has also identified business verticals that require a critical assessment. The same include – 1) Margo Networks (Sugarbox) 2) Teleplay & Zindagi 3) Hipi 4) Weyyak and 5) English Cluster of Linear TV Business. The Special Committee has advised that the identified business verticals will need to substantially reduce losses and enhance their performance levels.
The 3M Program Special Committee has also conducted a detailed analysis of the Technology and Innovation Centre (TIC), which had incurred an expenditure of approximately Rs 600 crore in the last year. "The Committee has noted that the TIC has developed a substantial level of technology and tools; however, it has highlighted the immediate need to focus on Return on Investment. The Special Committee has advised that the management should leverage the TIC’s Artificial Intelligence (AI) and Machine Learning (ML) tools to gain a deeper insight into the consumer profiles. With this view, the Committee has advised that the management should reduce the expenditure at the TIC by 50%, for FY25; and utilise its services to enhance the Company’s content development, distribution and monetisation approach," said Zee.
The 3M program has been instituted at a time when Zee's shares fell over 40% since mid-January when Japan's Sony Group scrapped a mega merger deal.
The two parties filed cases against each other after the deal collapsed. Sony had initiated arbitration proceedings before The Singapore Arbitration Center (SIAC) claiming Rs 748.5 crore as a termination fee.
On the other hand, Zee filed a petition before the Mumbai bench of the National Company Law Tribunal (NCLT), seeking a direction to Sony Group to implement the merger scheme. SIAC also denied Sony Group's plea seeking interim relief against Zee to restrain it from moving NCLT to enforce the failed merger of its subsidiary Culver Max with the Indian media house.
Zee also initiated appropriate legal actions to contest the claims of $90 million filed by Sony Group before SIAC.
More than two years after announcing their proposed merger, Sony on January 22 announced the termination of the deal while accusing ZEEL of not meeting closing conditions even after extending their closing period by a month.
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