MUMBAI: Ajay Bijli-promoted multiplex chain operator PVR, which last week announced acquisition of a majority stake in competing multiplex operator Cinemax India, has received approval from its shareholders to borrow up to Rs 10 billion.

The multiplex operator had convened an extra-ordinary general meeting of its shareholders on Thursday to seek approval for the proposed borrowing plan.

PVR did not state the purpose of proposing such a large borrowing plan. At the end of March 2012, it had long and short-term borrowings of about Rs 1.69 billion.

PVR has agreed to buy the entire 69.27 per cent promoter stake in Cinemax India for Rs 3.95 billion, which will make it the biggest multiplex operator in the country.

PVR with the backing of private equity investors will also make an open offer to public shareholders of Cinemax, which would eventually culminate in the delisting of the company?s shares.

As part of the open offer, Cine Hospitality will acquire up to 7.2 million fully paid-up equity shares of face value of Rs 5 each representing 26 per cent of the fully diluted voting equity share capital of Cinemax at a price of Rs 203.65 per share.

PVR had also got the board approval to issue 10.62 million fully paid equity shares on a preferential basis to Ajay Bijli, Sanjeev Kumar, L Capital, Multiples Private Equity Fund I Limited, and Multiples Private Equity Fund at Rs 245 per share to raise Rs 2.6 billion for the acquisition of the Cinemax stake.

Under the preferential issue of equity shares in PVR Limited, Multiples will invest an amount of approximately Rs 1.53 billion, L Capital would invest approximately Rs 823 million and Promoters would invest approximately Rs 250 million into PVR.

NEW DELHI: PVR Leisure Limited has received approval from the Foreign Investment Promotion Board (FIPB) to receive Rs 501 million as equity investment from a foreign private equity investor.

The foreign private equity investor is L Capital Eco with whom PVR had signed a definitive agreement for investing the amount in PVR Leisure and another Rs Rs 577 million in PVR Ltd, a film exhibition company.

The private equity investor L Capital Eco is a Mauritius-registered subsidiary of L Capital Asia LLC, the Asian private equity business sponsored by global luxury goods retailer LVMH.

As per the agreement with L Capital, PVR Leisure will house in-mall entertainment, gaming, food and leisure businesses. PVR has still not announce how much stake L Capital will get in PVR Leisure.

PVR will be transfering its holding in PVR bluO Entertainment Ltd to PVR Leisure.

The FIPB also considered a proposal from Multi Screen Media Pvt Ltd (MSM), the owners of Sony Entertainment Network, for induction of foreign equity into the company to carry out the business of production of television programmes in Indian languages primarily for export, sale and distribution of Indian language audio visual production, and downlink of certain TV channels.

The FIPB, however, decided to ?communicate separately? its decision on MSM?s proposal.

The FIPB said it will also communicate separately its decision on a proposal from Wire and Wireless India Ltd (WWIL) (now renamed Siti Cable) to issue warrants for bringing in foreign equity investment for its cable TV network business.