Zee to acquire remaining 20% share in technology platform Margo Networks

"Acquisition of 20 percent stake in Margo is for better administrative control and efficiency as a 100 percent subsidiary," Zee said.

It further said, "The Board in its meeting held on 31 July 2024, has approved the acquisition of balance 10,000 equity shares 1.e. 20 percent stake of Margo for a total consideration of Rs 1 lakh, thereby, making it a 100 percent subsidiary of the company upon such acquisition."

Zee management as part of its portfolio rationalisation initiative and conditions of merger was in the process of either liquidating/discontinuing /selling certain entities primarily Margo Networks Private Limited (Margo), the company said.

"During the year ended 31 March 2024, the management of the company had estimated liability to fund the closure costs at Rs 3,240 lakh, which had been approved by the board and impairment of Rs 211 lakh were treated as exceptional items. Further, during the quarter ended 30 June 2024, the board approved the incremental closure costs amounting to Rs 750 lakh which has been accounted and presented under exceptional items," Zee said.

Margo was incorporated on August 17, 2016 and during the last three financial years its operational revenue stood at Rs 95 lakh in FY24, Rs 2.1 crore in FY23 and in FY22 it was nil.

Earlier this year in April, Moneycontrol had reported that Margo Networks Pvt Ltd, which offers internet connectivity under the brand name Sugarbox, shut its operations on March 22, putting 50-60 of employees out of work.

The closure came amid the entertainment and media company’s deepening financial problems. Zee Entertainment, which is currently grappling with the fallout of its terminated merger deal with Sony, is cutting its workforce and has laid off 50 percent of the staff at its Technology & Innovation Centre (TIC) in Bengaluru.