PVR shares jump over 10% on Cinemax deal
Mumbai: Extending gains for the second consecutive day today, shares of multiplex major PVR today soared by over 10 percent after the company entered into an agreement with Cinemax India to acquire up to 95.27 percent stake in the company for Rs 543 crore.
Defying a weak opening, the stock made a smart comeback, gaining 9 percent to touch a 52-week high of Rs 278.60 on the BSE.
At NSE, the stock zoomed up by 10.56 percent to Rs 278.80.
A similar upsurge was seen in Cinemax India counter. The stock shot up by 5 percent to Rs 193.45, its record high level on the BSE.
PVR yesterday had said it would acquire up to 95.27 percent stake in Cinemax India, a Kanakia Group firm which is into movie exhibition business in India, in a deal worth about Rs 543 crore.
According to the agreement, PVR's wholly-owned subsidiary Cine Hospitality would acquire 69.27 percent stake owned by the promoter group of Cinemax at a price of Rs 203.65 for an all cash consideration of Rs 395 crore.
As per Sebi rules, this will be followed by an open offer for an additional 26 percent (up to 72.80 lakh equity shares) at Rs 203.65 per share, taking the total deal size to about Rs 543 crore.
The acquisition will help PVR has market leadership in the movie exhibition segment in India with a combined strength of 351 screens at 85 locations.