Key Points Of the Approval:
- The National Company Law Tribunal (NCLT) in Mumbai has verbally approved the merger of PVR Limited and INOX Leisure, with a written order expected to come in 15-20 days.
- Once the written order is issued, it will be filed by Registrars of Companies and stock exchanges.
- PVR and Inox Leisure had moved the NCLT seeking approval for the merger.
- In September, the Competition Commission of India had rejected a complaint against the merger from not-for-profit public policy and advocacy group Consumer Unity & Trust Society.
- On March 27, PVR and INOX Leisure announced the merger deal, with the intent to create the largest multiplex chain in the country.
- The merger will be completed in the next 3-4 weeks, with the new entity being named PVR INOX Limited and new cinemas opened post-merger being branded as PVR INOX.
- INOX will merge with PVR in a share-swap ratio of 3 shares of PVR for every 10 shares of INOX.
- PVR promoters will have 10.62% stake in the combined entity while INOX promoters will have 16.66% stake.
Details of the Approval:
The National Company Law Tribunal (NCLT) in Mumbai has given verbal approval for the merger of PVR Limited and INOX Leisure, two major film exhibition companies.
The official written order is expected to be released within 15-20 days and will be filed by the Registrars of Companies and stock exchanges once issued, according to The Economic Times. Further details on the merger are yet to be announced.
PVR has announced in a filing to the BSE that the National Company Law Tribunal (NCLT) in Mumbai has approved the proposed merger scheme on January 12th, 2023. The detailed order will be disclosed to stock exchanges as soon as it is received by the company.
The Bombay bench of NCLT had scheduled the final hearing for the PVR-Inox merger for January 12th, 2023 during its previous hearing on December 15th. PVR plans to finish the process of allotting shares to Inox shareholders within the next 3 to 4 weeks, which will complete the merger, as reported by Economic Times. PVR and Inox Leisure had previously approached the NCLT for approval of their proposed merger as two major film exhibition companies.
A not-for-profit public policy and advocacy group called Consumer Unity & Trust Society (CUTS) had previously challenged the order by the Competition Commission of India (CCI) regarding the PVR-Inox merger deal to the National Company Law Appellate Tribunal (NCLAT).
The case, which includes PVR and Inox as parties, was heard by a two-member bench and was adjourned until February 9th.
In September, the Competition Commission of India (CCI) rejected the complaint filed by Consumer Unity & Trust Society (CUTS) against the merger between PVR and Inox Leisure. The merger deal was announced on March 27th, with the Board of PVR and the Board of INOX Leisure approving the all-stock amalgamation of INOX with PVR at their respective meetings.
The merger is subject to the approval of shareholders of PVR and INOX, as well as regulatory approvals from stock exchanges, SEBI and other relevant bodies. Once all approvals have been obtained, INOX will merge with PVR. The joint statement from PVR and INOX stated that the purpose of the merger is to create the largest multiplex chain in the country, operating 1,546 screens across 341 properties in 109 cities.
The companies announced on March 27th that Ajay Bijli would be appointed as the Managing Director and Sanjeev Kumar as the Executive Director of the merged entity. Pavan Kumar Jain would be appointed as the Non-Executive Chairman of the Board and Siddharth Jain as the Non-Executive Non-Independent Director in the combined entity.
The merged entity will be named PVR INOX Limited, with existing screens continuing to be branded as PVR and INOX respectively. New cinemas opened after the merger will be branded as PVR INOX.
INOX will merge with PVR in a share-swap ratio of 3 shares of PVR for every 10 shares of INOX, as per the agreement.
PVR promoters will hold a 10.62% stake in the combined entity, while INOX promoters will hold a 16.66% stake.
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