MUMBAI: Inox Leisure has not managed to up its stake in Fame India through an open offer which it had to make after it acquired majority control in the multiplex chain as it had to compete against a more aggressive pricing from rival Reliance MediaWorks (RMW).
Inox managed to acquire only 1,075 shares from its open offer, which was announced last year for 8,231,759 shares, or 20.25 per cent stake in Fame India, at Rs 51 per share.
Inox holds 50.3 per cent of Fame India. The company had acquired 43.1 per cent stake from the Shroff family promoting group for Rs Rs 664.8 million. Later it acquired an additional 7.2 per cent through a block deal, executed at BSE , following which it made an open offer.
Anil Ambani-led RMW had countered Inox‘s pricing with an open offer for acquisition of 21.7 million Fame India shares, representing 53.38 per cent stake, at Rs 83 per share.
Inox announced the open offer closed today and said that as per the "provisions of Companies Act, 1956, Fame India has now become a subsidiary of Inox Leisure".
Inox currently has 38 operational properties, with 144 screens and a seating capacity of 40,140 in 25 cities across India.
Fame India, on the other hand, has 25 operational multiplexes with 95 screens and a seating capacity of 26,487 in 12 cities. Jointly, Inox controls the largest multiplex screen capacity in the country, the company said Friday.
Inox and Fame India director Deepak Asher said, "We are delighted to have completed this transaction and acquire control over Fame. This reiterates our core belief in the fundamentals and long-term prospects of the film exhibition business in India. We are now focused on seizing the attractive opportunities this transaction has created for us to increase top-line growth as well as achieving cost synergies, to enhance value for stakeholders of both companies."
The total holding of RMW in Fame India stands at 32 per cent following the completion of its open offer.
Shares of Inox closed Friday at Rs 64.95 on the BSE, dropping 7.81 per cent from the previous day‘s close. Fame saw a 9.83 per cent fall to Rs 78.9.
