The Board of Directors of PVR Limited (PVR) and the Board of Directors of INOX Leisure Limited (INOX), at their respective meetings held on Sunday, March 27, have approved an all-stock amalgamation of INOX with PVR.
The amalgamation is subject to the approval of the shareholders of PVR and INOX respectively, stock exchanges, SEBI and such other regulatory approvals as may be required.
Upon obtaining all approvals, when the merger becomes effective, INOX will merge with PVR. Shareholders of INOX will receive shares of PVR in exchange for shares in INOX at the approved share exchange (“swap”) ratio.
Merger Terms
Post the merger, the promoters of INOX will become co-promoters in the merged entity along with the existing promoters of PVR. Upon effectiveness of the scheme, the Board of Directors of the merged company would be re-constituted with total board strength of 10 members and both the promoter families having equal representation on the Board with two board seats each.
Ajay Bijli would be appointed as the Managing Director and Sanjeev Kumar would be appointed as the Executive Director. Pavan Kumar Jain would be appointed as the Non- Executive Chairman of the Board. Siddharth Jain would be appointed as Non-Executive Non-Independent Director in the combined entity.
The combined entity will be named PVR INOX Limited with the branding of existing screens to continue as PVR and INOX respectively. New cinemas opened post the merger will be branded as PVR INOX.
Post the merger, PVR Promoters will have a 10.62 per cent stake while INOX Promoters will have a 16.66 per cent stake in the combined entity
Strategic rationale and benefits
With PVR currently operating 871 screens across 181 properties in 73 cities and INOX operating 675 screens across 160 properties in 72 cities, the combined entity will become the largest film exhibition company in India operating 1546 screens across 341 properties across 109 cities.
Commenting on the announcement, Ajay Bijli, Chairman and Managing Director of PVR said – “This is a momentous occasion that brings together two companies with significantly complementary strengths. 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 the long term survival of the business and fight the onslaught of digital OTT platforms “
Similarly, Siddharth Jain, Director – INOX Leisure Ltd said, “Coming together of two iconic cinema brands, which are driven by passion, is certainly the most historic moment in the Indian cinema exhibition industry. As we head into the industry’s revival amidst headwinds, this decisive partnership would bring in enhanced productivity through scale, a deeper reach in newer markets and numerous cost optimization opportunities, and continue to delight cinema fans with world-class experiences and landmark innovations.”
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