HONG KONG — P.S. Saminathan, chairman of Indian multiplex group Pyramid Saimira, announced Monday that he plans to buy 24.9% of the company.
The shares, which he is purchasing from the group’s founders, N.C. Ravichandran and Nirmal Kotecha, will lift his personal stake to 46.9% of the outfit, or a majority of 51% if his family holdings are also included.
But it is not clear whether the dealings are a sign of optimism, a rescue bid or an example of opportunism.
The company, which likes to describe itself as the world’s third-largest exhibition company in terms of seat numbers and tickets sold, has given off highly contradictory signs in the past few weeks, and the shares are currently trading 87% down from their 52-week high. Saminathan is paying a 150% premium to market price and will acquire them at 200 rupees ($4.01) each.
Company, which already has theaters in six countries, including the U.S. and Malaysia, recently walked away from acquisition talks with the U.K.’s Reel Screen chain. Within India it slashed back its exhibition interests in the north and west of the country and quit the Hindi-language distribution business. And there has been much talk about movie productions delayed by financial difficulties.
But in recent days it announced plans to spend $40 million on theater renovations in South India and pressed ahead with plans to co-develop cheap multiplexes in China, where it has a local partner.
Company, also a significant player in the digital cinema sector, said it expects to operate 2,000 screens in India alone by 2010. It runs 875 screens at 55 locations around the world today.