PVR rose as much as 10 percent in early deals to hit a new 52-week high of ₹2,010.35 while Inox Leisure rallied 20 percent to hit its new 52-week high of ₹563.60 per share on the BSE.
"The Board of Directors of PVR Limited (PVR) and the Board of Directors of INOX Leisure Limited (INOX), at their respective meetings held today, have approved an all-stock amalgamation of INOX with PVR. The amalgamation is subject to the approval of the shareholders of PVR and INOX respectively, stock exchanges, SEBI and such other regulatory approvals as may be required. 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 said in a press release.
Post the merger, the promoters of INOX will become co-promoters in the merged entity along with the existing promoters of PVR. Ajay Bijli would be appointed as the Managing Director and Sanjeev Kumar would be appointed as the Executive Director, added the release.
"The combined entity will be named as PVR INOX Limited 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," PVR informed.
Post the merger, PVR Promoters will have a 10.62 percent stake while INOX Promoters will have a 16.66 percent stake in the combined entity
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 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," said Ajay Bijli, Chairman and Managing Director of PVR on the merger.
At 9:35 am, PVR was trading 6 percent higher at ₹1,934.50 while Inox Leisure was trading 13 percent higher at ₹529.65 on the BSE.