Reliance MediaWorks, a part of Reliance Group, has completed the transaction for sale of its multiplexes business to Carnival Cinemas Ltd., in the largest ever deal in the sector in India.
The entire sales proceeds for sale of multiplex business have been duly received by RMW from Carnival Cinemas, and will be used to reduce Reliance Capital's leverage by approx. Rs. 700 crore, through a combination of transfer of debt of RMW and infusion of cash proceeds.
Sam Ghosh, Executive Director, Reliance Capital Ltd., stated, "We are happy to announce closing of this transaction with Carnival Group, which will reduce our overall leverage by approx. Rs 700 crore. This will lower our debt equity ratio to a conservative 1.75:1, amongst the lowest in the financial services sector in India.
The transaction is in furtherance of Reliance Capital's stated objective of focusing purely on its core financial services businesses, significantly reducing exposure to non-core investments in the media and entertainment sector, and reducing overall debt," added Mr. Ghosh.
RMW had announced sale of its multiplex business to Carnival Cinemas in December last year, and the transaction has now been closed upon receipt of all approvals. The deal excludes real estate owned by RMW at IMAX Wadala and other properties, which are intended to be separately monetized for an approx. value of Rs. 200 crore.