New Delhi: Leading film exhibition players PVR Ltd and Inox Leisure Ltd, after a meeting of their board of directors on Sunday, announced a merger deal to create the largest multiplex chain in India with a network of over 1,500 screens.
After the meeting, it has been decided that the combined entity would be named PVR Inox Ltd with the branding of existing screens to continue as PVR and Inox, and new cinemas opened post the merger will be branded as PVR Inox, the two companies said in separate statements.
However, the merger is yet to receive the approval from the Competition Commission of India (CCI).
"The amalgamation is subject to the approval of the shareholders of PVR and INOX, respectively, stock exchanges, SEBI and such other regulatory approvals as may be required. Post the merger, the promoters of INOX will become co-promoters in the merged entity along with the existing promoters of PVR,” the statement said as quoted by news agency PTI.
According to the agreement, Inox will merge with PVR in a share swap ratio of three shares of PVR for every 10 shares of Inox.
PVR promoters will have a 10.62 per cent stake while Inox will have 16.66 per cent stake in the combined entity.
Post the merger, PVR's Ajay Bijli will be appointed as the Managing Director, Sanjeev Kumar would be the Executive Director, Inox's Pavan Kumar Jain will be appointed as the Non-Executive Chairman of the board and Siddharth Jain would be the Non-Executive Non-Independent Director.
The board of the merged company would also be reconstituted with total 10 members and both the promoter families would have equal representation with two seats each.
According to the statement, the merger will result in significant complementarity and growth potential with compelling revenue and cost synergies.
PVR’s Ajay Bijli, as quoted by PTI, said, “The partnership of these two brands will put consumers at the centre of its vision and deliver an unparalleled movie-going experience to them. The film exhibition sector has been one of the worst impacted sectors on account of the pandemic and creating scale to achieve efficiencies is critical for the long-term survival of the business and fight the onslaught of digital OTT platforms.”
Inox Leisure Director Siddharth Jain said, “As we head into the industry's revival amidst headwinds, this decisive partnership would bring in enhanced productivity through scale, a deeper reach in newer markets and numerous cost optimisation opportunities, and continue to delight cinema fans with world-class experiences and landmark innovations.”
Currently, PVR has 871 screens across 181 properties in 73 cities, while Inox operates 675 screens across 160 properties in 72 cities.
"The combined entity will become the largest film exhibition company in India operating 1,546 screens across 341 properties across 109 cities,” as per the statement.