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PVR to acquire 71.69% stake in SPI Cinemas for Rs 633 cr

Press Trust of India  |  New Delhi 

chain Ltd today said it is acquiring 71.69 per cent stake in South India-based for about Rs 633 crore in an all cash deal.

It said that the company's board has also approved the issuance of 1.6 million shares of for the residual stake.

said in a regulatory filing that the board has approved the execution of a Share Purchase Agreement (SPA) in this regard.

The acquisition involves buying of SPI's 61.65 per cent from and 10.04 per cent equity from S V Swaroop Reddy, it said.

The proposed acquisition is in line with the PVR's continual growth and expansion strategy, it said.

"Such inorganic growth will enable the company to expand its presence in South and make a mark on the film exhibition industry there.

"The acquisition of 71.69 per cent stake in SPI will be for a cash consideration of about Rs 633 crore," PVR said.

The boards of both the companies have approved merger, it said adding, "1.6 million equity shares of PVR to be issued for residual 28.3 per cent stake".

PVR CMD Ajay said: "The acquisition of is of significant strategic value for PVR and will further cement our market leadership position in

He said the acquisition will make PVR the in the South Indian market & provide an attractive platform "for us to expand in that geography, which currently is highly underpenetrated in terms of multiplexes... This transaction is a significant step in helping us achieve our vision of having 1000 screens by 2020".

Post the transaction, PVR will have 706 screens operational across the country and the company said this acquisition will make it the number 1 operator in top 3 cities of South -- Chennai, Bangalore, and

As per the terms of the SPA, the acquisition will have to be completed within 30 days from execution of the agreement and the merger into the within a period of 18 months from the date of completion of the acquisition.

The Board has also approved "provisions for customary call/put options for acquisition of the remaining 28.31 per cent stake in the SPI from SS Theatres LLP, if triggered, for a consideration not exceeding RS 300 crore."

SPI, which has a presence states like Tamil Andhra Pradesh, Nadu, Telangana, and Kerala, has total assets of 63 crore an turnover of Rs 308.60 crore as on March 31, 2018.

operates 76 screens across 17 properties in 10 cities under several brands Sathyam, Escape, Palazzo, The Cinema,

PVR said it will fund the transaction through a combination of internal accruals, debt issuance and deferred payment of a part of the consideration (Rs 100 crore) to be paid on achievement of certain milestones.

In 2016, PVR had acquired 32 screens of DT cinemas from realty major DLF for Rs 433 crore. PVR operates over 600 screens in 51 cities in India.

At present, PVR operates over 600 screens in 52 cities in India.

(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)

First Published: Sun, August 12 2018. 21:00 IST
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