After the acquisition of Cinemax in 2012 for Rs. 395 crores, the cinema giant – PVR cinemas – has now rolled up its sleeves with the multiplex chain DT Cinemas, a wholly owned subsidiary of DLF, for Rs. 500 crores. This is towards the goal of becoming country’s largest cinema exhibition firm.
With this deal, PVR will acquire DT Cinemas’ 39 screens (29 operational and 10 proposed) in NCR and Chandigarh. Henceforth, PVR will have a presence in 44 cities with 115 multiplexes and 506 screens.
For DLF, the country’s largest realty firm, the deal is part of its strategy to exit non-core businesses and cut huge debt of over Rs.20,000 crore. It has already sold hotel chain Aman Resorts as well as insurance and wind power businesses.
According to industry experts, there are more buyouts likely to play out in the cinema exhibition space. The consolidation wave began in July 2014, when Inox Leisure, the second largest exhibition chain by screens, bought Satyam Cineplex for over Rs.200 crore, including debt. With this, Inox expanded its presence to 50 cities, with 91 multiplexes and 358 screens.
“Even though significant assets have been bought out, there will be more acquisitions in the coming two years in this space. Growing organically is a difficult proposition for these companies as it is dependent on state approvals and fewer malls being built,” said Jehil Thakkar, head-media and entertainment, KPMG India.
Source: Business Today