Multiplex chains PVR and INOX Leisure announce merger

As per the deal approved by the respective boards, INOX will merge with PVR in a share exchange ratio of 3 shares of PVR for 10 shares of INOX.

The merged entity will be named as PVR INOX Ltd with branding of existing screens to continue as PVR and INOX respectively.

New cinema halls opened post the merger will be branded as PVR INOX.

"Upon obtaining all approvals, when the merger becomes effective, INOX will merge with PVR. Shareholders of INOX will receive shares of PVR in exchange of shares in INOX at the approved share exchange (“swap”) ratio," PVR and INOX said in separate regulatory filings on the BSE.

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 reconstituted with total board strength of 10 members and both the promoter families having equal representation on the Board with 2 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 joint statement said.

Commenting on the announcement, Ajay Bijli, Chairman and Managing Director of PVR said that the merger brings together two companies with significantly complementary strengths.

"The partnership of these two brands will put consumers at the center 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 the long term survival of the business and fight the onslaught of digital OTT platforms," he said.

Listing out the benefits of the merger, the official statement said that 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.

"The combination would augur well for the growth of the Indian cinema exhibition industry, besides ensuring tremendous value creation for all stakeholders, including customers, real estate developers, content producers, technology service providers, the state exchequer and above all, the employees," said the statement.

Siddharth Jain, director, INOX Leisure said that coming together of two cinema brands is 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," he said.