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PVR acquires DT Cinemas

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PVR Ltd, on November 13th, announced that it has reached an agreement with DLF Group’s DT Cinemas to acquire their cinema business on a slump sale basis.

PVR will fund the acquisition through part stock and part cash payout. PVR Ltd, will issue 25.57 lakh shares to DT Cinemas representing 10 per cent of the fully diluted paid up share capital of PVR Ltd and make a payment of Rs.20.2 crores to fund the above acquisition.

DT cinemas has a current portfolio of 29 screens with 26 screens currently operational and another three screens expected to commence operations in the next six months. All the acquired cinemas are on long term lease in various mall developments being owned/operated by DLF Group.

As part of the overall alliance, PVR shall be offered exclusive rights to operate as a key anchor multiplex partner in all future mall developments of the DLF Group. DLF has a huge portfolio of future mall developments planned in key markets at Delhi (Chankya Puri), Mumbai, Chennai, Hyderabad, Noida, Jallander, Lucknow etc. and this partnership should enable PVR to further expand its screen count by participating in all these developments.

While announcing the above transaction, Ajay Bijli, chairman and managing director PVR Ltd said, “The acquisition of DT Cinemas and long term strategic partnership with the prestigious DLF Group is part of our expansion strategy and will further enhance PVR’s position as a leading multiplex operator in the country. PVR will now control 60-70 per cent of the market share in Delhi and Gurgaon market and will further strengthen PVR’s position as one of the largest multiplex player in India.”

He further added, “The industry is undergoing a paradigm shift. We foresee an opportunity for growth in the film and exhibition space and we want to be prepared to meet the challenges and provide innovative solutions in entertainment.”

The deal further re-affirms PVR’s strategy to rapidly grow in the film exhibition space and to become a dominant player across key markets.

In another event, PVR announced that it is offering 10 per cent of its equity capital to Major Cineplex Group Plc., one of Thailand’s largest entertainment group. Under the above arrangement, Major Cineplex Group Plc. would be investing approx Rs.42 crs. into PVR Limited by subscribing to 25.57 lakh of new shares.

Major Cineplex Group Plc. is Thailand’s leading lifestyle entertainment company with core business in multiplexes, film distribution, lifestyle neighborhood malls, bowling and karaoke, ice skating rink, fitness clubs and advertising media. Major Group is listed on the stock exchange of Thailand and currently operates about 350 multiplex screens, 500 bowling lanes, 300 karaoke rooms and two ice skating rinks. The company had a turnover of approx. Rs.8050 million in 2008 with a net profit of Rs.907 mn.

—IndiaRetailing Bureau

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