BSE, NSE approve PVR-INOX merger to reshape India’s multiplex business   

Multiplex chains PVR and Inox Leisure have received approval from exchanges—Bombay Stock Exchange (BSE) and National Stock Exchange (NSE) for a merger —on Tuesday late night.  

PVR and Inox Leisure received an observation letter with ‘no adverse observations’ dated June 20 from the BSE and an observation letter with ‘no objection’ dated June 21, as per their respective exchange filings. 

The filings read, “In this regard, we would like to inform you that the company has received observation letter with “no adverse observations” dated June 20, 2022 from BSE Limited and an observation letter with “no objection” dated June 21, 2022 from National Stock Exchange of India Limited respectively in relation to the Scheme of Amalgamation.” 

The scheme of amalgamation, as the filings say, is subject to requisite regulatory approvals from the Competition Commission of India (CCI). 

For the unversed, PVR and INOX’s board of directors had approved the merger of both the multiplex chains in March this year. If the merger is materialized, Pavan Kumar Jain will be appointed as non-executive chairman of the Board and Ajay Bijli would become the managing director. 

While Sanjeev Kumar will be appointed as the executive director, Siddharth Jain would be appointed as a non-executive non-independent director in the combined entity. 

As per PVR’s exchange filing, “The proposed amalgamation would be in the best interest of the transferee company and the transferor company and their respective shareholders, employees, creditors, and other stakeholders.” 

It further noted the shareholders, employees, customers, and lenders would benefit from increased scale, innovations in technology and expanded reach with increased opportunities for growth, higher cross-selling opportunities to a larger customer base, and improvement in productivity amongst others. 

Post the merger, INOX promoters will have 16.66 per cent in the merged company whereas PVR promoters will hold 10.62 per cent. The Board of directors of the merged entity will be re-constituted with 10 members in total and promoter families will have equal representation on the board with two seats each. The share exchange ratio will be three shares of PVR for 10 shares of INOX. 

The combined entity will become the largest film exhibition company in India and operate 1,546 screens across 341 properties in 109 cities. Currently, INOX operates 675 screens 160 properties in 72 cities and PVR operates 871 screens 181 properties in 73 cities.