Leading film exhibition players PVR Ltd and INOX Leisure Ltd on Sunday announced a merger deal to create the largest multiplex chain in the country with a network of more than 1,500 screens. The boards of directors of the two companies at their meetings held on Sunday approved an all-stock amalgamation of INOX with PVR, the two companies said in separate regulatory filings.

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In an interview with CNBC-TV18, Ajay Bijli, CMD of PVR said the merger will add momentum to the business.

“The exhibition sector got impacted severely in the last two years. So we felt that if both of us come together, the impetus and the momentum which was getting lost would come back.”

According to Bijli, NCLT, SEBI, shareholder approvals for the merger could take 6-9 months.

The announcement comes at a time when the film exhibition industry has been impacted by the COVID-19 pandemic and significant pressures on the theatrical business from the accelerated growth of digital OTT platforms. The combined entity will be named PVR INOX Ltd 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, the regulatory filing said. As per the agreement, INOX will merge with PVR in a share swap ratio of 3 shares of PVR for every 10 shares of INOX.

Siddharth Jain, Director of INOX Leisure said the merged entity will look to a double number of screens in 5-7 years from the current 1,500 screens.

“Currently as a combined entity we have 1,500 screens but India has about 9,500 screens, China has about 70,000 screens. So our aim is to double the number of screens in the next 5-7 years.”

Shares of INOX Leisure and PVR were trading with gains of around 11.75 percent and 3.5 percent respectively at market close on Monday.

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First Published:Mar 28, 2022 4:22 PM IST