Film exhibitor and distributor PVR today said has entered into an agreement with Infinite India Investment Management, a part of JM Financial Group, for sale and leaseback of its multiplex property in Mumbai for Rs 100 crore.
The seven screen multiplex property at Phoenix Mills, Lower Parel in Mumbai is one of the premier flagship properties of PVR and is among its highest revenue earning multiplexes.
"The property will be sold to Infinite India Investment Management for Rs 100 crore, to be leased back to PVR Ltd for operating the existing multiplex," PVR Chief Financial Officer Nitin Sood told PTI without giving the lease duration.
He said the company's board will decide how the Rs 100 crore will be used, but said primarily the money will be utilised to fund the company's long-term expansion plan.
While Infinite India is the investment manager for real estate fund sponsored by the JM Financial Group, the property has been owned by CR Retail Malls India, an arm of PVR.
The transaction has been structured in such a manner that Infinite India will fully acquire CR Retail Malls India as a result of which the property would also come to its account.
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In a filing to the Bombay Stock Exchange (BSE) PVR said its board today approved the sale of two crore equity shares of Rs 10 each of CR Retail Malls to companies of JM Financial Group.
"PVR shall receive a sum of Rs 100 crore pursuant to the transaction, in the form of refund of existing loans made to CR Retail and consideration against sale of equity shares," the filing said.
Post completion of the transaction, PVR will continue to operate the multiplex property on a long term lease arrangement basis, the filing added.
Commenting on PVR's expansion plan Sood said: "The company currently operates 142 screens across India and plans to add about 50 to 70 new screens in the current fiscal."
JM Financial Group's Infinite India Investment Management, a 50:50 joint venture with SRS Fund plans to invest USD 400 million in residential, commercial and retail sectors, according to the company's website.
GenReal Property Advisers, a real estate consulting firm, acted as advisers to the transaction.
PVR'S scrips closed at Rs 100.95 per share, down 4.94% from the previous close on the BSE.