PVR, INOX Leisure announce merger, Ajay Bijli will be MD of entity

The board of directors of PVR Limited (PVR) and  INOX Leisure Limited (INOX) on Sunday approved an all-stock amalgamation of INOX with PVR at their respective meetings.

The amalgamation is subject to approval of the shareholders of PVR and INOX, stock exchanges, market regulator Sebi and and such other regulatory approvals as may be required.

Upon obtaining all the approvals, the merger will become effective and INOX will merge with PVR.

Shareholders of INOX will receive shares of PVR in exchange of shares in INX at the approved share exchange (swap) ratio. Following the merger, INOX promoters will become co-promoters of the merged entity, along with the existing promoters of PVR.

The combined entity will be named as PVR INOX Limited with branding of existing screens to continue as PVR and INOX respectively. The new cinemas opened post the merger will be branded as PVR INOX.

Ajay Bijli will be appointed as the managing director and Sanjeev Kumar would be appointed as the executive director. Siddharth Jain will be appointed as non-executive, non-independent director in the combined entity. 

The Board of Directors of the merged company will be re-constituted with total board strength of ten members and both the promoter families will have equal representation on the Board with two board seats each. Inox shareholders will receive three shares in PVR for 10 shares of Inox, PVR said in a stock exchange filing.

Post merger, PVR Promoters will have 10.62 per cent stake while INOX Promoters will have 16.66% stake in the combined entity.

“This is a momentous occasion that brings together two companies with significantly complementary strengths. The partnership of these two brands will put consumer at the center of its vision and deliver an unparalleled movie going experience to them," said Ajay Bijli, chairman and MD of PVR.

"The partnership of these two brands will put the consumer 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 long-term survival of the business and fight the onslaught of digital OTT platforms," he added.

“Coming together of two iconic cinema brands, which are driven by passion, certainly the most historic moment. Both companies have set high service benchmarks in Indian cinema exhibition industry," said Siddharth Jain, director of INOX Leisures.

Axis Capital provided a fairness opinion to PVR on the share-exchange ratio while Ernst & Young Merchant Banking Services gave the fairness view to Inox.

PVR currently operates 871 screens across 181 properties in 73 cities and INOX operates 675 screens across 160 properties in 72 cities and the combined entity will become the largest film exhibition company in India with 1,546 screens across 341 properties across 109 cities.