RCap finishes sale of multiplex business

The sale proceeds will be used to reduce Reliance Capital's leverage through a combination of transfer of debt of Reliance MediaWorks and infusion of cash proceeds

Anil Ambani's Reliance MediaWorks (RMW) has completed the transaction for sale of its multiplexes business to Carnival Cinemas Ltd for Rs 700 crore.

The sale proceeds, which have been duly received by RMW from Carnival Cinemas, will be used to reduce Reliance Capital's leverage through a combination of transfer of debt of RMW and infusion of cash proceeds.

Sam Ghosh, executive director, Reliance Capital Ltd., stated, "We are happy to announce closing of this transaction with Carnival Group, which will reduce our overall leverage by Rs 700 crore. This will lower our debt equity ratio to a conservative 1.75:1, amongst the lowest in the financial services sector in India.

"The transaction is in furtherance of Reliance Capital's stated objective of focusing purely on its core financial services businesses, significantly reducing exposure to non-core investments in the media and entertainment sector, and reducing overall debt," he added.

RMW had announced sale of its multiplex business to Carnival Cinemas in December last year, and the transaction has now been closed upon receipt of all approvals. The deal excludes real estate owned by RMW at IMAX Wadala and other properties, which are intended to be separately monetised for an approximate value of Rs 200 crore.