Multiplex operators PVR and INOX on Thursday received approval from the Mumbai bench of the National Company Law Tribunal's (NCLT) approval their merger.
"we would like to inform you that NCLT, Mumbai Bench, has allowed the Proposed Scheme today i.e., 12th January 2023. The copy of detailed order is awaited and the same shall be disclosed to the Stock Exchanges as and when received by the Company," said PVR in a stock exchange filing.
On Thursday, the company's shares closed 2.7% higher at Rs 1,750 apiece.
The merged entity, to be called PVR-INOX, will become the largest film exhibition company in India, operating 1,546 screens across 341 properties in 109 cities, according to the merger announcement on March 27, 2022.
After the merger, the combine plans to open 200 new screens every year under the brand name PVR-INOX rather than refurbishing old properties. A capex of Rs 500 crore will be pumped into setting up the new screens.
Analysts estimate the combine will command a 50 per cent share among multiplex screens and 16 per cent in the overall market including single screens. In terms of shareholding in the merged entity, the INOX promoters will hold 16.66 per cent, while the PVR founders’ share will be 10.62 per cent.
INOX’s Pavan Kumar Jain will be the non-executive chairman of the merged entity, while PVR’s Chairman and MD Ajay Bijli will be the MD. His brother Sanjeev Kumar Bijli will be the executive director and INOX Leisure Director Siddharth Jain will be non-executive, non-independent director in the combined entity.
The PVR-INOX combine is also likely to foray into film production and ramp up its distribution and food & beverage businesses after the proposed merger as a way to diversify revenue.