While the exact value of the deal was not disclosed, the company says this deal will reduce Reliance Capital’s debt by about Rs 700 crore. Reliance MediaWorks will also have the option of acquiring a pre-IPO minority stake in Carnival Cinemas at a discounted price, upon eventual listing of the company. That being said, its worth noting that this deal doesn’t include Reliance MediaWorks owned IMAX Wadala and other properties.
Earlier this year, Carnival Cinemas had also acquired Housing Development and Infrastructure Ltd (HDIL) owned multiplex chain Broadway Cinemas for an undisclosed amount. In July this year, Carnival Group chairman Shrikant Bhasi had told Livemint that they are also in talks to acquire 175 screens from three separate multiplex operators in Andhra Pradesh, Punjab & Uttar Pradesh, although he didn’t share further details on this.
Following this deal, Carnival Cinemas claims to be third largest multiplex operator in the country with over 300 screens. Inox with 358 screens across 91 multiplexes in 50 cities, and PVR Cinemas with 444 screens across 101 multiplexes in 43 cities are ahead of Carnival Cinemas.
Carnival Cinemas, which is currently operational in Kerala, Karnataka, Tamil Nadu, Maharashtra, Madhya Pradesh, Uttar Pradesh & West Bengal, has over 50 operational screens under its brand. An additional 75 screens are expected to be operational with the next two months.
Inox-Satyam Cineplexes deal: In August this year, Inox had acquired 100% stake in New Delhi-based Satyam Cineplexes for Rs 182 crore. The acquisition gave Inox an entry into Delhi (and neighbouring Gurgaon, Greater Noida and Faridabad), which is dominated by PVR. At the time, Inox Leisure CEO Alok Tandon had told Business Standard that they will be adding a further 156 screens over the next two years, which would take their total screen count to 514. Inox also has plans of opening new screens in Jamnagar, Kurnool, Faridabad and Jaipur this year.
Interestingly, Inox had also acquired Fame Cinemas after a lengthy takeover battle with Big Cinemas in 2010. The company had rebranded Fame Cinemas to Inox screens last year. PVR had also acquired 69.3% stake in competing multiplex chain Cinemax for Rs 394 crore in November 2012.