Zee Entertainment exits global smallcap index, $22 million ‘hit’

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Zee Entertainment Enterprises Limited (ZEEL) may exit the MSCI Global Smallcap Index. This may happen after the company’s merger with Sony Pictures. Zee Entertainment has received final approval from the National Company Law Tribunal for the proposed merger and the two companies are in the final stages of the merger. Shares of Zee Entertainment on the BSE on Friday traded at Rs. closed at 265.65.

An outflow of 22 million dollars is possible
So far, the effective date of the merger has not been announced. MSCI will announce the last trading date for Zee Entertainment Enterprises later. According to Nuwama Alternative and Quantitative Research, the final trading day for shares of Zee Entertainment Enterprise could fall in late September or early October, resulting in an outflow of $22 million.

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The merged entity will be listed in 4-7 weeks
The merged entity will be relisted on the exchanges within 4-7 weeks from the last trading day of ZEE Entertainment Enterprises Limited. This unit can be listed around November. Currently, ZEE Entertainment Nifty A part of the midcap index, but strong post-merger price action could pave the way for the merged entity to enter the Nifty Next 50. The merged company may move to this index in March 2024 index review. According to Nuwama, Zee Entertainment’s futures and options contracts will expire on the last trading day.

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Disclaimer: The information provided here is only about stock performance and does not constitute investment advice. Investing in the stock market is subject to risk and you should consult your advisor before investing.

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