ErosSTX

Eros Media World

Eros Media World

Indian mass media corporation

Eros Media World plc[5] (formerly ErosSTX Global Corporation[6]) is an Indian media company that acquires, produces, and distributes films, television shows, and digital content.[7] The company is led by executive chairperson Rishika Lulla Singh.

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History

Eros International plc was founded by Arjan Lulla and Kishore Lulla in 1977 as an Indian film and television production and distribution company.[8] The company launched its ErosNow OTT service in 2012, which by 2020 had 36.2 million paid subscribers,[9] and the largest library of Indian content in the world.[10] Eros International plc became the first Indian media company to list on the Alternative Investment Market (AIM) of the London Stock Exchange. Subsequently, the company delisted from AIM in November 2013 to list on the New York Stock Exchange.[11] Eros merged with STX Entertainment in an all-stock deal in April 2020 to become ErosSTX Global.[12] Sixteen months later, ErosSTX entered into negotiations to sell the STX business.[13]

On 7 December 2021, Jahm Najafi's Najafi Companies announced that it had reached an agreement to acquire STX Entertainment from ErosSTX for US$173 million.[14] Lionsgate also emerged as a potential suitor, but it was rejected on 10 March 2022, leaving Najafi as the only suitor left.[15] The sale was closed in April 2022, effectively splitting STX from ErosSTX and making it an independent studio again.[16]

Shortly after the sale of STX, ErosSTX announced their rebranding to Eros Media World plc, with some changes in management and reduced debt following STX's sale. Eros Media World would, however, retain a 15% stake in STX. Rishika Lulla Singh was named executive chairman, with Pradeep Dwivedi acting as the new CEO and Rajesh Chalke being stated as the new CFO of the company. The company will focus on its content library and film studio Eros International, as well as Eros Now and Eros Music.[5]

Eros did not file its Form 20-F annual report for the fiscal year ending March 31, 2021, as well as its Form 6-K semi-annual report for the period ending September 30, 2021, to the Securities and Exchange Commission (SEC) by the deadline of August 17, 2022. Consequently, Eros shares were delisted by NYSE Regulation, and trading of these shares was suspended. Eros publicly declared in January 2023 that it had chosen not to pursue an appeal against the delisting.[17]

In 2014, Eros launched a £50 million bond in London. It was supposed to be repaid in April 2023, but in March 2023 the company offered to repurchase up to half their bonds at a price of 60p in the pound and delay repayment of the rest of the bonds until 2026.[18] After numerous bondholders agreed to the deal, Eros offered to purchase only £2m of bonds, and delay payment until March 2024. This announcement caused Eros bond prices to drop to 16p.[citation needed]

In June 2023, in India, the Securities and Exchange Board of India (SEBI) barred Eros International Media and CEO Pradeep Kumar Dwivedi from the securities market until further notice for allegedly breaching trade practice regulations.[19] In July 2023, the Bank of India filed a claim against the UK arm of Eros in the London Circuit Commercial Court. As a result, the company put its UK business into insolvency.[20] Meanwhile, ErosNow, the flagship digital property of Eros, began to experience intermittent outages.[21]

Management

Rishika Lulla Singh serves as Eros Media World's executive chairperson, Pradeep Dwivedi as CEO and Rajesh Chalke as CFO.

Eros Media World's board of directors is composed of Kishore Lulla, Rishika Singh, Dhirendra Swarup, and Dilip Thakkar.

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Controversies

Inappropriate social media content related to Navratri

In October 2020, Eros Now and Arre had posted highly vulgar content on social media targeting the holy Hindu festival of Navratri.[22] They deleted the posts after receiving severe criticism.[23]

Undisclosed transactions

The short seller Hindenburg Research documented multiple undisclosed related-party transactions that appear to be designed to hide receivables and route them to Lulla family members.[24] The SEBI investigation noted that a significant portion of Eros revenue from operations, trade receivables, and loans extended primarily involved transactions with related parties. These figures had witnessed a notable surge during the fiscal year 2019-20. The initial report indicated that, on the surface, these transactions suggested potential financial irregularities or the diversion of funds by the company.[25][26] SEBI also barred Eros Worldwide and Eros Digital - entities that own a stake in Eros International Media from dealing in the securities market.[27] Additionally, SEBI directed the Bombay Stock Exchange to appoint a forensic auditor to examine the books of three exclusively BSE-listed companies - Thinkink Picturez, Mediaone Global Entertainment, and Spicy Entertainment & Media, who have acted as conduits in the alleged misrepresentation and diversion of funds by Eros.[28]

References

  1. [1]
    "Eros International Plc Reports Fourth Quarter and Fiscal Year End 2019" (Press release). Eros International. July 15, 2019. Retrieved December 11, 2020 – via Business Wire.
  2. [2]
    "Eros International Plc Reports Strong Revenue and Profit Growth in FY 2018" (Press release). Eros International. June 27, 2018 – via Business Wire.
  3. [3]
    "How strong is Eros International Number of Employees?". Macroaxis.
  4. [4]
    "Eros STX Global Corp - Company Profile and News". Bloomberg L.P. Retrieved October 17, 2020.
  5. [5]
    Ramachandran, Naman (April 25, 2022). "Renamed Eros Media World To Retain 15% Stake in STX, Projects Revenue Growth, Reduced Debt". Variety. Retrieved June 10, 2022.
  6. [6]
    "Eros International Plc Announces Corporate Name Change to ErosSTX Global Corporation" (Press release). ErosSTX International. September 11, 2020. Retrieved September 23, 2020 – via Business Wire.
  7. [7]
    "STX to Remain Independent Studio as Deal Closes with Najafi Companies & Eros Divorce Final". April 22, 2022.
  8. [8]
    Hayes, Dade (July 30, 2020). "Eros And STX Close Merger, Plan New York Stock Exchange Debut In September, Eye $1B In Revenue By 2022". Deadline. Retrieved July 30, 2020.
  9. [9]
    "Eros Now Reaches 36.2 million Paying Subscribers" (Press release). ErosSTX International. November 18, 2020 – via Business Wire.
  10. [10]
    "Eros India CEO Explains STX Merger Logic: "The Bigger Story Is on the OTT Side"". The Hollywood Reporter. April 22, 2020. Retrieved December 11, 2020.
  11. [11]
    "Eros International Plc". London Stock Exchange. September 18, 2013. Retrieved April 28, 2015.
  12. [12]
    "Eros International announces all-share merger with STX Entertainment". Business Standard. April 18, 2020. Retrieved September 3, 2023.
  13. [13]
    "STX Entertainment Exploring Sale 16 Months After Eros International Merger". Yahoo News. November 16, 2021. Retrieved September 3, 2023.
  14. [14]
    "STX Separating From Eros As Najafi Companies Enters $173M Agreement To Acquire Hollywood Studio". Deadline. December 7, 2021. Retrieved December 7, 2021.
  15. [15]
    D'Alessandro, Anthony (January 26, 2022). "Lionsgate Looking To Acquire STX Entertainment". Deadline. Retrieved January 26, 2022.
  16. [16]
    D'Alessandro, Anthony (April 22, 2022). "STX Remaining Independent Studio As Deal Closes With Najafi Companies & Eros Divorce Final". Retrieved April 23, 2022.
  17. [17]
    "Eros Media World Plc Announces It Will Not Appeal NYSE Delisting". www.businesswire.com. January 9, 2023. Retrieved September 3, 2023.
  18. [18]
    "Bollywood firm Eros' UK backers left in lurch". msn.
  19. [19]
    "Sebi bars Eros Intl from market, CEO from holding Board positions until further orders over diversion of funds". Business Today. June 22, 2023. Retrieved September 3, 2023.
  20. [20]
    "EROS INTERNATIONAL LIMITED | Appointment of Administrators | The Gazette". www.thegazette.co.uk. Retrieved September 3, 2023.
  21. [21]
    "Has Eros Now shut down? Users complain about the OTT platform lying non-operational for more than 10 days". The Times of India. February 17, 2023. ISSN 0971-8257. Retrieved September 3, 2023.
  22. [22]
    www.ETBrandEquity.com. "Daily Morning Newsletter". ETBrandEquity.com. Retrieved September 3, 2023.
  23. [23]
    "Eros Now faces social media ire for sharing 'vulgar' memes on Navratri; company issues apology". The Tribune. October 22, 2020. Retrieved September 3, 2023.
  24. [24]
    "Eros International: On-The-Ground Research, Employee Interviews, and Private Company Documents Expose Egregious Accounting Irregularities". Hindenburg Research. June 7, 2019. Retrieved September 3, 2023.
  25. [25]
    www.ETLegalWorld.com. "SEBI bars Eros International from market, CEO and MD restrained a director or a Key Managerial Personnel in any listed company - ET LegalWorld". ETLegalWorld.com. Retrieved September 3, 2023.
  26. [26]
    "Intimation under Regulation 30 of the SEBI" (PDF). June 23, 2023. Retrieved September 3, 2023.
  27. [27]
    Bureau, BL Mumbai (June 22, 2023). "SEBI bars Eros". BusinessLine. Retrieved September 3, 2023.
  28. [28]
    Zachariah, Reena (June 23, 2023). "Sebi bans Eros International, its promoter and CEO from securities markets". The Economic Times. ISSN 0013-0389. Retrieved September 3, 2023.
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