wordpress blog stats
Connect with us

Hi, what are you looking for?

Pyramid Saimira To Close Unviable Subsidiaries; Stake Dilution Plans


Pyramid Saimira will undergo massive restructuring soon – it is closing shutters of ‘unviable’ subsidiaries overseas and bringing the others under a single umbrella. The Indian entertainment multinational lost Rs 40.32 crores when its Rajnikant starrer Kuselan bombed at the box office, and is now reeling under a massive liquidity crunch. (Related: the issue of stars in films). Pyramid Saimira was in the digital distribution business, owns a European DTH company Spize TV and gaming developer Aurona Technologies, among others.

Pyramid Saimira had reported a net loss of Rs 74.74 crore in the quarter ended December 2008. It recorded net sales of Rs 137.94 crore. The company also faces a tax bill of Rs 26.57 crores that has been deferred to March 31st.

Promoters To Dilute Further

The core promoters, V Natrajan, N Narayanan and PS Saminathan, have already diluted their stake from 25 percent to 17.9 percent to raise liquidity to help it overcome the financial crisis. Other promoters include corporate bodies with 25 percent; FIIs/FIs hold around 12 percent; CitiGroup Global Markets, Bennett Coleman & CO, Mavi Investments with 3.41 percent, 1.77 percent and 1.81 percent respectively; Punjab National Bank with 3.54 percent. The promoters are now considering further diluting their shares and are talking to private equity players and financial institutions to raise liquidity.

The Rise: A Pleasant Autumn…

Advertisement. Scroll to continue reading.

In June 2008, the company had leased over 45 lakh seats through 802 screens worldwide. In early September, Saimira acquired distribution rights for four more films in India. It set up a joint venture in China and planned to invest $30 million to establish 25 theatres. It inaugurated the 290 seat Huainan Pyramid Lonozhe Theatre Entertainment Tower in China. It announced plans to invest Rs 200 crores towards renovation of 250 screens in South India. In October 2008, the company’s London based subsidiary Aurona Technologies bagged a gaming contract from the publisher Deep Silver.

The Fall: …Followed by a Chilly Winter

In September, Pyramid Saimira reviewed its expansion plans quoting ‘high inflation, slackening of demand for entertainment and food products and constraints of margins in leisure industry’ as reasons. Medianama reported Pyramid was closing down 33 screens and had dropped plans for acquisitions in UK and Europe. The number of screens fell to 745 by September and to 252 by December due to poor spending and content failure .

Kotecha Dumps Stock: Price Manipulation?

In November, Pyramid’s director, Nirmal Kotecha, resigned from the company. Nirmal Kotecha had invested in Pyramid shares and even bought shares from other investors. After the IPO, he held 70,36,619 shares, close to 25 percent shares in September. He started selling them quickly in November and by December owned only 12.92 percent shares in the company. Earlier this month, he dumped his entire holding of 0.24 per cent in the company, sparking curiosity and talk of price manipulation in the shareholding community.

Foul Play: Stock Loses 94% of its Market Value

Advertisement. Scroll to continue reading.

False media reports claiming that SEBI had ordered P S Saminathan, a promoter, to make open offer at a price that was at a substantial premium to its market price put the company in the limelight in December. As the company’s stock rose, it fell again when SEBI clarified that it had not issued such a letter. A whopping 72 lakh shares were traded during this period, raising eyebrows.

Subsequently SEBI began an investigation to track the apparently forged letter. In a press release to BSE, the company alleged that competitors were hammering its share price and creating panic amongst investors. But harm had been done and Pyramid’s stock took a sharp dive to Rs 29.05. The stock has lost 94 per cent of its market value in the course of a year.

Future is In Consolidation

Reeling from its bad fortunes, the company announced in January that it was undertaking measures to increase profitability of its screens by reducing their numbers and moving some to a revenue sharing model to cut operational losses. It announced that the group had the following companies under it:

— Saimira Access Technologies – a services and IPTV provider
— Spize TV Pte – a DTH provider in UK
— Its USA subsidiary;
— Joint ventures in China and Malaysia
— Its subsidiaries Dimple Cine Advertising
— Game developer Aurona Technologies
— Post production subsidiary
— Content distribution subsidiary for Singapore and India and
— Its umbrella company for exhibition and investment holding Pyramid Saimira Theatre 

Now, the company may have to surrender some of these too. PSTL president N Narayanan has told Financial Express, “We came to an understanding that some of these subsidiaries are not doing well and found to be unviable. We want to close those unviable ones while bringing all the other subsidiaries under single holding company.”

Advertisement. Scroll to continue reading.

This month, the company is fighting off rumours of SUN TV acquiring the group and betting on the Tamil movie Naan Kadavul that will release in five cities in US.


Sep 1: Pyramid Saimira acquires distribution rights for four films

Sep 17: Inaugurates its first ever Cineplex in China

Sep 23: Reviews Expansion Plans, closes 33 screens; drops plans for acquisitions in UK and Europe

Sep 30: Announces plans to modernize 250 screens in South India

Advertisement. Scroll to continue reading.

Oct 6: Subsidiary Aurona Technologies announces game art contract with US-based Deep Silver

Nov 17: Director Kotecha Resigns

Dec 5: Amends its Initial Conversion Price of FCCBs from Rs 454.00 per Bond to Rs 246.50.

Dec 22: Issues clarification on media reports on Open Offer

Dec 24: Issues a press release calling for an investigation by SEBI

Jan 13: Issues clarification on news of P S Saminathan selling shares at a low price

Advertisement. Scroll to continue reading.

Jan 30: Announces Q3 Results

Feb 2: Denies reports of Sun TV group acquiring the Pyramid Saimira

Pyramid Saimira Winds Up Film Distribution In India; Defers Reel Acquisition
Pyramid Saimira releasing Naan Kadavul in USA

Written By


MediaNama’s mission is to help build a digital ecosystem which is open, fair, global and competitive.



The US and other countries' retreat from a laissez-faire approach to regulating markets presents India with a rare opportunity.


When news that Walmart would soon accept cryptocurrency turned out to be fake, it also became a teachable moment.


The DSCI's guidelines are patient-centric and act as a data privacy roadmap for healthcare service providers.


In this excerpt from the book, the authors focus on personal data and autocracies. One in particular – Russia.  Autocracies always prioritize information control...


By Jai Vipra, Senior Resident Fellow at Vidhi Centre for Legal Policy The use of new technology, including facial recognition technology (FRT) by police...

You May Also Like


135 job openings in over 60 companies are listed at our free Digital and Mobile Job Board: If you’re looking for a job, or...


Rajesh Kumar* doesn’t have many enemies in life. But, Uber, for which he drives a cab everyday, is starting to look like one, he...


By Aroon Deep and Aditya Chunduru You’re reading it here first: Twitter has complied with government requests to censor 52 tweets that mostly criticised...


Google has released a Google Travel Trends Report which states that branded budget hotel search queries grew 179% year over year (YOY) in India, in...

MediaNama is the premier source of information and analysis on Technology Policy in India. More about MediaNama, and contact information, here.

© 2008-2021 Mixed Bag Media Pvt. Ltd. Developed By PixelVJ

Subscribe to our daily newsletter
Your email address:*
Please enter all required fields Click to hide
Correct invalid entries Click to hide

© 2008-2021 Mixed Bag Media Pvt. Ltd. Developed By PixelVJ