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MUMBAI: Chennai-based theatre chain company Pyramid Saimira
will enter into a 40:60 joint venture with a leading real
estate company for setting up 100 malls entailing an investment
of Rs 60 billion.
The buzz is that Pyramid will sign the deal with IVRCL Infrastructure
and Projects Ltd. "We are in talks with three leading
real estate developers including IVRCL but haven't concluded
anything yet. All the three are listed companies," says
Pyramid Saimira Theatre Ltd. managing director PS Saminathan.
Pyramid Saimira will raise around Rs 4 billion through a foreign
currency convertible bond (FCCB) or a qualified institutional
placement (QIP) as its share of funding for the project. "We
could even go for a mix of both FCCB and QIP. We have no debt
in the company and can leverage our cash balance. The equity
dilution will be around 5-6 per cent," says Saminathan.
Pyramid will set up a special purpose vehicle for the project.
The company has identified 700 locations in South India, out
of which 200 it has found feasible for sustaining a multiplex
or mall. In West Bengal it will have 15 locations for its
malls and multiplexes, four of which will be in Kolkata. "Every
location should be able to generate Rs 500 million from the
second year of operations for it to be viable," says
Saminathan.
The plan is to have 300 screens through this venture. The
malls, covering 20-25 million square feet of space, will be
spread across the southern states of India and West Bengal.
"We will have 50 per cent of the malls dedicated for
the entertainment sector," says Saminathan.
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