New Delhi: The country’s premium multiplex chain PVR is set to buy southern giant SPI Cinemas in an effort to establish its dominance over the key markets in Tamil Nadu, Telangana, Andhra Pradesh, Karnataka, Kerala and Mumbai.
SPI Cinemas, which operates 31 screens including the iconic Sathyam Cinema established in 1974 in Chennai, also has a signed pipeline of over 100 screens that are expected to be rolled out over the next five years.
Under the terms of the proposed acquisition, PVR will acquire 222,711 equity shares of SPI Cinemas, constituting 71.7 per cent of the paid up equity share capital of SPI from existing shareholders for a total consideration of Rs 633 crore and issue 1.6 mn equity shares of PVR Limited constituting 3.3 per cent of the diluted paid up equity share capital of the company.
Noting that the acquisition would cement its leadership position in the country, chairman-cum-managing director of PVR Ltd Ajay Bijli said, “The acquisition will make PVR the undisputed leader in the south Indian market and provide an attractive platform for us to expand in that geography, which currently is highly under-penetrated in terms of multiplexes. This transaction is a significant step in helping us achieve our vision of having 1,000 screens by 2020.”
Kiran Reddy of SPI Cinemas said the chain had been revolutionising the movie-watching experience for its patrons by “consistently bringing in world-class technology and innovative offerings”. “We are excited to now partner with the largest Indian multiplex chain PVR as this combines two proven business models and will create significant value for moviegoers as well as all the stakeholders,” he added.