The Competition Commission of India has approved the acquisition of DT Cinemas by PVR, subject to exclusion of certain assets in order to check anti-competitive concerns.
The CCI approves PVR’s acquisition of DT Cinema’s multiplexes/single screen theatres in Delhi NCR and Chandigarh, subject to modification.
The proposed combination relates to the acquisition by PVR of DLF’s film exhibition business ‘DT Cinemas’, comprising 39 screens (29 existing and 10 upcoming) as a going concern on a slump-sale basis.
For the purpose of competition assessment of the proposed combination, the Commission defined the relevant geographic markets as Gurgaon, South Delhi, North, West and Central Delhi, Noida, and Chandigarh.
DLF also informed the BSE that the CCI has approved the proposed combination in relation to acquisition of DT Cinemas, with certain modifications, which inter alia include exclusion of DT Savitri (one screen) and DT Saket (six screens) from the proposed combination. Both parties are initiating the necessary steps to successful closing of this transaction.
The CCI order stated that the PVR has given certain commitments such as divestiture of 15 screens in Noida at Garden Galleria, divestiture of seven screens in Gurgaon at Airia Mall, apart from commitment to not open any new theatre or acquire existing theatres in South Delhi for five years.
The commitments by PVR, as stated in the order, also include price caps on tickets and food and beverage prices for PVR and DT Cinemas in South Delhi for five years with an ability to increase prices by no more than 5 per cent of prevailing prices in the fourth and fifth year.
PVR will also not seek exclusivity of content from any distributor for ive years from the date of final order.
Meanwhile PVR, in a statement to the BSE, informed that the company is assessing the order and will take appropriate action in due course.
In June 2015, DLF had announced that its subsidiary, DLF Utilities Ltd, has entered into definitive agreements to sell its cinema exhibition business operated under the brand name of ‘DT Cinemas’, to PVR Ltd, on a slump-sale basis for an aggregate consideration of ₹500 crore.