Inox Leisure Ltd and PVR Ltd, leading film exhibition players, have reportedly announced a merger to create India’s largest multiplex chain with a network of over 1,500 screens. The board of directors of the two companies approved an all-stock merger of PVR and Inox, as stated by Inox and PVR in separate regulatory filings.
Under the agreement, Inox will consolidate with PVR in a share swap ratio of 3 to 10 for shares of PVR and Inox respectively. The consolidated entity will be dubbed PVR Inox Ltd with the branding of current screens to continue as Inox and PVR. Post the merger, new cinema halls will be branded as PVR Inox.
According to the filing, the amalgamation will be executed subject to the approval of Inox and PVR shareholders, SEBI, stock exchanges, and other regulatory approvals as per requirement. With the completion of the merger, Inox promoters will become co-promoters in the consolidated entity along with current PVR promoters.
PVR promoters will have a stake of nearly 10.62 percent whereas promoters of Inox will have a 16.66 percent stake in the consolidated entity.
Once the merger comes into effect, the board of the consolidated firm would be assigned with a board strength of ten members, and both sets of promoters will have equal representation with two seats each.
The consolidation will untap substantial growth potential and provides compelling cost and revenue synergies.
Inox's Pavan Kumar Jain will be employed as the Board’s Non-Executive Chairman whereas Siddharth Jain would be chosen as the Non-Executive Non-Independent Director in the consolidated entity. Ajay Bijli of PVR will be hired as the entity’s Managing Director.
Mr. Bijli stated that the collaboration of the two brands will be centered around consumers and will offer them an unmatched movie-going experience.
Currently, PVR operates 871 screens throughout 181 properties across 73 cities whereas Inox runs nearly 675 screens across 72 cities.
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