Reliance MediaWorks, with two other group firms, has acquired a further 0.20% stake in Fame India, taking their combined holding in the multiplex chain to 15.03%. Three entities of the Anil Dhirubhai Ambani Group (ADAG) ? Reliance MediaWorks, Reliance Capital and Reliance Capital Partners ? acquired 68,862 shares of Fame through open market transactions. The acquisition was made on May 27, Fame India said in a filing to the Bombay Stock Exchange (BSE) on Friday.
Reliance MediaWorks? scrip rose 4.36% to close at Rs 171 on the BSE on Friday.
ADAG firms purchased the shares at an average price of Rs 82.73 per share. The highest price paid was Rs 82.82, the statement said. Reliance MediaWorks, which is in competition with Inox for acquiring stake in Fame, has already made a Rs 180-crore open offer to buy 52.72% stake in Fame at Rs 83.40 a share. Inox holds 51% stake in Fame and has made an open offer for an additional 20% at Rs 51 per share. Reliance MediaWorks operates BIG Cinemas, which is India?s largest cinema chain.
Fame India has been the subject of a takeover battle between Reliance MediaWorks and Inox Leisure Ltd, from the beginning of the year, when Inox acquired 50.48% in Fame and followed it up with an open offer for an additional 20%.
Analysts say that Fame India is a well-established company in the segment. Hence, buyers will have to offer a premium on the acquisition. However, the company has a debt of nearly Rs 1,410 crore of which foreign currency convertible bonds account for Rs 85 crore. ?There is no clarity whether Fame will be de-listed or hived off as a separate entity once it is taken over and whether the debt also gets transferred to the acquirer,? an analyst said.
Meanwhile, the deal is equally important for INOX, which already holds 51% stake in the company and the 95 screens that Fame owns will take its total screen tally to 205, close to BIG Cinemas, with 242 screens. An analyst said, ?The deals makea business sense for Inox because it has a huge presence in eastern India , whereas Fame dominates in the western belt. The acquisition would help Fame acquire a pan-Indian presence.?