Carnival Cinemas has acquired the multiplex business of Reliance MediaWorks (RMW). The proposed transaction will make Carnival enter the list of top three multiplex operators in the country, with over 300 screens nationwide.
Shrikant Bhasi, chairman, Carnival Group, said, “I am thankful to Anil D. Ambani, chairman, Reliance Group, for his support to a first generation entrepreneur like me, and in facilitating this transaction with Carnival Cinemas in preference to other leading cinema chains. We are targeting to achieve 1,000 screens by the year 2017, and look forward to the continued support of Reliance Group in our future growth."
Sam Ghosh, CEO, Reliance Capital Ltd, said, "We are delighted to begin a long term relationship with the rapidly growing Carnival Group, through the sale of the multiplexes business of Reliance MediaWorks to them. We look forward to supporting the Group in their future growth initiatives in India and overseas. The proposed transaction is in furtherance of Reliance Capital's stated objective of focusing purely on its core financial services businesses, significantly reducing exposure to non-core investments in the media and entertainment sector, and reducing overall debt."
The transaction will reduce Reliance Capital's leverage by approximately Rs.700 crore, through a combination of transfer of debt of RMW and infusion of cash proceeds. The deal excludes real estate owned by RMW at IMAX Wadala and other properties, which are intended to be separately monetised for an a value of Rs. 200 crore.
Bhasi added, "We are very serious about exhibition business and are moving in an organic way also. Carnival Cinemas will not only make their presence in tier I but would lay emphasis for strong presence across tier II & III cities. We want to make Cinemas synonymous to Carnival."
The proposed transaction is subject to necessary statutory and other approvals and is expected to close within the current financial year.