PVR & Inox both companies announced a merger on Sunday.

The merger comes at a time when the fear of contracting the coronavirus is receding now and demand for movie-watching is likely to see a strong rebound hereon, unless, of course, there are fresh curbs driven by a serious spread of covid-19 again. Recall that both companies have suffered massive losses in the past two fiscals as the multiplex sector was amongst the worst hit owing to the enforcement of strict restrictions during the pandemic.

As per the share swap ratio, investors will get three shares of PVR for every 10 shares of INOX Leisure. Analysts said the ratio is slightly favourable to INOX investors by about 12 per cent, probably due to its zero net debt situation compared with PVR’s net debt at Rs 857 crore.

Experts believe this merger will likely take over six months as it will be subject to approvals from the National Company Law Tribunal (NCLT), stock exchanges, Securities and Exchange Board of India (SEBI), Competition Commission of India (CCI) as well as shareholders.

The merged company will be named PVR INOX. While the existing properties will continue to use their respective brands, the new screens will be branded PVR INOX. The boards of both PVR and INOX have approved this merger on a share-swap basis, and INOX shareholders will receive 3 shares of PVR for 10 shares of INOX.