Agri Business

Big picture: Multiplex chain PVR hopes to hit 1,000 screens by 2020

Meenakshi Verma Ambwani New Delhi | Updated on August 13, 2018 Published on August 13, 2018

Nitin Sood, Chief Financial Officer, PVR   -  BUSINESS LINE

Leading multiplex chain PVR Ltd, which announced its strategic acquisition of SPI Cinemas on Sunday, is looking to close this fiscal with 800 screens. The company also plans to keep the branding of SPI Cinemas unchanged in Tamil Nadu.

Post the completion of the acquisition of SPI Cinemas, PVR’s total screen count will increase to 706 across 152 properties and 60 cities, the company said.

Nitin Sood, CFO, PVR Ltd, said: We expect to close this year with 800 screens. Besides a network of 76 screens, SPI Cinemas has an upcoming pipeline of 13 screens, which are also expected to open this fiscal. Also, PVR has its own robust pipeline of screens, with some of them set to open this fiscal year.”

PVR believes this strategic acquisition will play a key role in helping it achieve its vision of operating 1,000 screens by 2020.

SPI Cinemas currently operates its multiplexes under various brands which include Sathyam, Escape, Palazzo and S2 Cinemas. Asked about the company’s future branding strategy, Sood said, “There are no plans to change the branding of the multiplexes located in Tamil Naidu, where SPI Cinemas is a dominant player. But outside Tamil Nadu, in markets such as Mumbai, Bengaluru and Hyderabad, where PVR is stronger we may look at changing the branding over a period of time.”

Under the terms of the proposed acquisition, PVR will acquire a 71.7 per cent stake in SPI Cinemas for ₹633 crore and issue 1.6 million equity shares of PVR constituting 3.3 per cent of the diluted paid-up equity share capital of the company valued at around ₹212 crore.

In its BSE filing, the company has said that the cash consideration of ₹633 crore will be funded through internal accruals (₹385 crore) and debt (₹150 crore), while ₹100 crore will be paid on a deferred basis subject to completion of certain milestones by SPI Cinemas.

Replying to a query on growth plans, Sood said, “We believe the key focus for us will now be on organic growth strategies.”

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Published on August 13, 2018
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