Theatre chain INOX Leisure is close to acquiring the promoters’ stake of 44 per cent in Shravan Shroff’s Fame India. The company has been valued at Rs 101 crore, much lower than its market capitalisation of Rs 134 crore.

“Talks have been on for the last two months. Inox may not buy stake at a premium because Fame has around Rs 80 crore debt,” said a source. Anand Shah, analyst, Angel Broking, added: “Fame has debt on its books and has been looking for buyers since a long time.”

Also Read   Related Stories News Now - Battle brews over sharing of revenue from 3 Idiots - Paa proves a triumph for the Bachchans - Inox plans 10 new multiplexes - Producers, multiplexes script end to dispute - Rising sugar prices sour Pepsi bottom line - FMCG companies may raise prices or reduce product size

Also Read   Related Stories News Now - Markets end on a strong note - Nabard FY14 operating surplus soars 28% to Rs 1,635 cr - RBI eases banks' term deposit restrictions - NMDC Q4 net down 21.74% to Rs 1,642.28 cr - Balrampur Chini Q4 profit up by 15% More

The number of cinema halls under INOX’s fold would go up to 204 (including Fame’s 95)from the current 108. Anil Ambani’s BIG Cinemas leads the pack of multiplexes with 242, followed by PVR Cinemas with 134 screens (including DT Cinemas’ screen acquisition).

This deal would help INOX increase its presence in Western India, specially in Mumbai, where it has just one property. It has enjoyed strong presence in the eastern region. Considering INOX’s turnover of Rs 226 crore as on March 2009 and Fame’s of Rs 110 crore, it should emerge a strong competitor to the leader. PVR’s turnover as on March 2009 was Rs 305.3 crore.

Fame’s share price was up by five per cent today, at Rs 38.40. INOX’s stock was down one per cent to Rs 82.30. This would be the second big acquisition after PVR Cinemas took over real estate developer DLF’s theatre business, DT Cinemas, this year.

Under the deal, PVR would issue 2.5 million shares to DT Cinemas, representing 10 per cent of PVR’s fully diluted paid-up capital. This values the shareholding at Rs 32.2 crore, given its then market capitalisation of Rs 322 crore. PVR would also pay Rs 20.2 crore for the acquisition, putting the deal value at roughly Rs 50 crore.

New Ipad Application :Business Standard's all new IPad App Click here to download for free Other Stories      - Markets end on a strong note - Nabard FY14 operating surplus soars 28% to Rs 1,635 cr - RBI eases banks' term deposit restrictions - NMDC Q4 net down 21.74% to Rs 1,642.28 cr - Balrampur Chini Q4 profit up by 15%

Tags : INOX Leisure | Shravan Shroff | Fame India | Anand Shah | | Angel Broking | | PVR Cinemas | Anil Ambani | BIG Cinemas |   Read Business news in  Advertisements -  Journey on, We are by Your Side. Click here to know more -  2 Lac Apartments, 1 Lac House / Plots. Click here -  Help a Child Achieve her. Click to know more -  Benefits Upto Rs. 2.36 Lakhs on the Fully Loaded TJet Petrol. -  The Best Seller is Also the No. 1 in Mileage. Click here -  Watch The Film Here. Click here to know more.. -  Leader in Passenger Car & Automobile Tyres. Click here -  1 billion in saving for Unilever without any tangles. -  A Brand New Server at a Price That Fits Your Budget. Click here -  Learn How One City is Running on FOOD SCRAPS. -  One Partnership Endless Possibilities. Click here to know more -  Helping doctors detect diseases earlier, saving costs & extending lives. -  36 Lakhs can get you a pool of Luxuries. Click here -  Which is the best plan for your daughter -  Check out the TRUE COLOURS of your Stocks, Now for FREE! -  One of the leading business schools in the world.Know More