Media baron Subhash Chandra's Zee Telefilms Ltd, which announced last Thursday that its promoters had placed 5 million shares with a U.S.-based institutional investor, will receive around Rs 500 million in the transaction, merchant banking sources point out. CIBC Oppenheimer paid slightly less than Rs 100 a share for its stock holding in Zee, the sources say.

The shares reportedly represent 1.3 per cent of ZTL's paid-up capital and lowers the promoters' stake to around 59 per cent. The group promoters had earlier borrowed around Rs 2200 million from ZTL for the Essel group. They had announced that the entire amount would be returned by June 30. However, the Essel group has since then managed to pay back Rs 600 million.

Rajesh Jain - president - corporate finance and strategy, when contacted refused comment on the identity of the FII while maintaining that Zee had raised a total of around Rs 600 million in the current transaction. "The institutional investor who has purchased these shares is a long-term investor in ZTL," an official release had said. Sources aver that if the official figure of Rs 600 million proves true, then it is likely that the balance of Rs 100 million will come from Zee's promoters. Head of corporate affairs R.K. Singh has said the money from the transaction would be coming in before the end of the week.

Jain, when queried as to when the balance amount would be returned, said: "We are committed to returning the full amount with interest at the earliest possible time."

With this placement, the promoters' holding stands at 59 per cent, foreign institutional investors (FIIs) have 21 cent, financial institutions and mutual funds 9 per cent and the balance is with the public.

The figure of Rs 2200 million is what the Zee Network had reportedly advanced to Essel group investment companies, which was subsequently transferred to cornered bull Ketan Parekh's investment companies.

CIBC Oppenheimer's interest in Zee stock could be because at Rs 100 a share it is seen as a good buy, the sources say. There is also the added advantage that a bulk amount of stock was being made available to Oppenheimer which otherwise would have had to be mopped up from the market.