Kochi-based hospitality-to-realty major Carnival Films Pvt Ltd, which has become the third-largest multiplex player in India after the recent acquisition of Anil Ambani-controlled Big Cinemas, is looking to grab the second spot in the space by the end of fiscal 2014-15, a Business Standard report said citing a senior executive of the company.
Carnival, which operates cinema chains under the brand ‘Carnival Cinemas’, has signed the term sheets to acquire two regional multiplex chains in North India and is expected to close the deals in a week or two, Shrikant Bhasi, chairman, Carnival Group, told the paper.
He, however, refused to disclose the names of the companies the group is looking to acquire, citing regulatory restrictions. The report added that the South India-based company will have to shell out around Rs 150 crore to acquire the aforesaid two regional multiplex chains.
On December 15, Carnival Films signed a deal with Reliance MediaWorks Ltd (RMW), an arm of Anil Ambani-led business conglomerate Reliance Group, to acquire its multiplex business.
RMW operates one of the largest cinema chains, under the brand ‘BIG Cinemas’ with over 250 screens across India.
Founded in 2012, Carnival currently has over 50 operational screens while 75 screens are to come on stream in two months taking the total portfolio to 125 screens. With the acquisition Carnival Cinemas will emerge as the third-largest multiplex operator and expects to reach 400 plus screens by this fiscal.
Carnival Group has interests in media and entertainment with segments like movie production, international concerts, reality shows and wedding planning in India and overseas. The group entered the movie business five years ago as financers for Bollywood films.
The group now has presence across Ghaziabad, Mumbai (Vasai, Borivali, Bhandup), Kolkata, Calicut, Trivandrum, Cochin, Kollam, Ernakulam, Thalayolaparambu, Dindigul, Mumbai and Hyderabad.
Carnival has adopted both organic and inorganic mode of expansion to speed up the growth. It aims to have 1,000 screens in the country by 2017.
“This (the target of 1,000 screens) will help the smaller film-makers distribute their movies with ease, even without the backing of big studios,” Bhasi told the paper.
Early this month, Carnival struck a deal to acquire real estate developer Housing Development and Infrastructure Ltd’s (HDIL) multiplex chain Broadway Cinema for Rs 110 crore ($18 million).
At present, Ajay Bijli’s PVR leads the race as largest multiplex player with 454 screens in the country, while INOX Leisure Ltd is number two with 361 screens.
PVR had sealed a large deal by acquiring Cinemax a couple of years ago and overtook INOX as the top multiplex operator in terms of number of screens. Prior to that INOX’s acquisition or Fame had made it the top player in its business. PVR is also reportedly looking to strike a deal in south India to strengthen its presence by acquiring SPI Cinemas.
Recently, INOX Leisure agreed to acquire New Delhi-headquartered Satyam Cineplexes (Satyam) for Rs 182 crore ($30 million), as part of its efforts to strengthen its position as the second-largest multiplex operator in the country behind PVR.
The acquisition of Satyam shall be the third by INOX in less than a decade. INOX has earlier acquired Calcutta Cine Pvt Ltd in 2007, which triggered the consolidation phase in the multiplex industry, followed by Fame India Ltd in 2010 after being involved in a takeover battle with Reliance Group’s Big Cinemas.
There are also a few mid-size players such as Fun Cinemas, Wave Cinemas and DLF’s DT Cinemas.
(Edited by Joby Puthuparampil Johnson)