Mexico's Cinepolis Eyeing Stake in India's Big Cinemas (Report)
The world's fifth largest multiplex operator is reportedly in talks with India's largest theatrical chain, Reliance-owned Big Cinemas.
NEW DELHI – Mexico's Cinepolis chain is in talks with India's largest theatrical chain, Big Cinemas (owned by Reliance MediaWorks) to acquire a stake according to a report Monday in India's the Business Standard newspaper.
Cinepolis is the fifth largest multiplex player in the world with over 2,500 screens. In 2009, Cinepolis became the first international theatrical player to foray into India with plans to invest about $78.45 million (Rupees 3.80 billion) to launch 110 screens across eight cities. So far Cinepolis has launched 32 screens in five cities.
As part of diversified film services group Reliance MediaWorks (RMW), Big Cinemas runs a total of 530 screens worldwide which include 256 screens in India. Owned by DreamWorks' equal partner, conglomerate Reliance ADAG group, RMW's divisions include digital post production facilities and a recently built studio in Mumbai's Film City.
The reported talks of Cinepolis acquiring a stake in Big Cinemas could point to earlier developments when the RMW board approved the transfer of the company's cinema exhibition and film and media services into separate 100% subsidiaries subject to shareholder approval. The strategy to invite equity investors in the spinoff subsidiaries is a forerunner to RMW's planned $111 million rights issue.
RMW CEO Anil Arjun could not be reached for comment. In an earlier interview with The Hollywood Reporter, Arjun said, “Our theatrical business and film services unit have a combined asset base of $400 million. A final valuation of these two planned subsidiaries is being done, based on which the size of proposed equity investment in these units will be determined... With RMW facing a debt of about $300 million, the combined rights issue and proposed equity investment will dramatically reduce the company's debt.”
Meanwhile, the Business Standard also reported that the Indian theatrical market was being considered by other potential foreign players including Grand Cinemas (based in the United Arab Emirates) and “several South Korean players and others”.