PVR to acquire SPI Cinemas

PVR is one of the cinema chains in India. The company began as a joint venture between Priya Exhibitors Private Limited and Village Roadshow Limited in 1995 and began their commercial operations in 1997, headquartered in Gurgaon, India. SPI Cinemas is an Indian Multiplex and film production company owned by SPI Group, headquartered in Chennai, India. It is originally named as Sathyam Cinemas.

The PVR Group seems set to acquire SPI Cinemas for 750-1000 crore, in what could end up as biggest deal in India Multiplex sector. The SPI Group currently runs a cinema exhibition, distribution, and production business. It has five brands of theatres named as Sathyam, Escape, The Cinema, S2 Cinemas, and Luxe. The group operates around 56 screens, mainly in Tamil Nadu and within a few in Andhra Pradesh.

PVR, with 454 screens in 102 locations across 43 cities, is the largest cinema exhibitor in terms of screens. Of these, 204 screens are in western India, 133 in the north, 98 in the south, and 19 in the east. If PVR acquires this asset, it would be a good acquisition because it intends to double its capacity in the next four-five years. PVR and Inox Leisure Ltd, India’s second largest cinema operator in terms of screens, together command close to 50% of the screens in India’s multiplex sector.

With more number of smart cities and malls, there is a open area for companies to expand. Last year, Inox acquired Delhi based Satyam Cineplexes Ltd for Rs. 182 Cr. With this Inox expanded its presence to 50 cities, with 91 multiplexes and 358 screens. In 2007, Inox acquired Calcutta Cine Pvt. Ltd, and in 2010, it acquired Fame India Ltd. In November 2012, PVR had acquired Mumbai headquartered Cinemax Ltd from its promoters for Rs. 395 Crore.