PVR to buy Cinemax for 3.95 billion rupees

MUMBAI Fri Nov 30, 2012 12:26am IST

People buy tickets at a counter in a multiplex movie theatre in Mumbai November 22, 2008. REUTERS/Arko Datta/Files

People buy tickets at a counter in a multiplex movie theatre in Mumbai November 22, 2008.

Credit: Reuters/Arko Datta/Files

Related Topics

Stocks

   

MUMBAI (Reuters) - PVR (PVRL.NS) is to buy control of rival Cinemax India (CINX.NS) for 3.95 billion rupees to create the country's biggest operator of multi-screen movie theatres.

PVR will buy a 69 percent stake from Cinemax's founders for 203.65 rupees per share, a 16 percent premium to Wednesday's close. Listing rules mean PVR must make an offer for up to 26 percent of Cinemax held by public shareholders.

PVR, which also operates a film distribution and production business, will manage about 350 screens after the deal, compared with a little more than 200 now.

A growing middle class and rising spending power in India has seen moviegoers flock to multiplexes where tickets cost less than half as much as the older single-screen theatres they are fast replacing.

Multiplexes make up fewer than 15 percent of the country's nearly 12,000 movie screens. Still, they accounted for a third of box office takings in 2011, according to a KPMG report.

The deal will boost PVR's bargaining position when negotiating film distribution terms, analysts said.

PVR said its board had approved raising about 2.6 billion rupees via an issue of preferential shares.

Rival BIG Cinemas, a unit of billionaire Anil Ambani's Reliance MediaWorksRELM.NS, has 253 screens, according to its website.

Cinemax shares rose by their daily limit of 5 percent to close at 184.40 rupees on Thursday. Shares in PVR, which has a market capitalisation 6.8 billion rupees, ended up 6.4 percent at 252.15 rupees after rising as much as 16 percent during the day to their highest level in 4-1/2 years.

(Editing by Tony Munroe and Dan Lalor)

FILED UNDER:
Comments (0)
This discussion is now closed. We welcome comments on our articles for a limited period after their publication.

  • Most Popular
  • Most Shared

CELEBS

ENTERTAINMENT SHOWCASE

Parole Denied

Parole Denied

Killer of actor Kelsey Grammer's sister denied parole in Colorado.  Full Article 

Chart Topper

Chart Topper

5 Seconds of Summer debut album tops Billboard 200 chart.  Full Article 

Hobbit Trailer

Hobbit Trailer

Trailer for "The Hobbit: the Battle of the Five Armies" released.   Video 

Tribute to Cale

Tribute to Cale

Eric Clapton pays musical tribute to long-time friend JJ Cale.  Full Article 

"My Bed" has a Home

"My Bed" has a Home

Artist Emin's grotty "My Bed" to have long-term home in Britain.  Full Article 

Space Adventure

Space Adventure

Marvel cranks up sarcasm and 70s sound for 'Guardians of Galaxy'.  Full Article 

Comic-Con

Comic-Con

Highlights from the annual Comic-Con gathering in San Diego.  Slideshow 

Screen Adaptation

Screen Adaptation

Toy giant Mattel joins box office race with Max Steel.  Video 

Photo

Reuters India Mobile

Get the latest news on the go. Visit Reuters India on your mobile device.  Full Coverage