Cineline acquires R&H Spaces Private Ltd; stock ends higher

The company is currently engaged in the business of owning and running and rent-yielding fixed income assets through its malls and theatre properties.

Nov 27, 2020 10:11 IST India Infoline News Service

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In a regulatory filing on Friday, Cineline India Limited informed the exchanges that the Board of Directors of the company has accorded their approval for acquisition of 100% equity shares of R&H Spaces Private Limited by Company's wholly owned subsidiary i.e. "Transquare Realty Private Limited" by executing share purchase agreement.

The share capital of R&H Spaces Private Limited or RHSPL has a share capital of Rs1 lakh. The said acquisition will be conducted at an arm's length basis and only subject to prior approval of non-interested minority shareholders of the company, said the company. Kanakia Hotel & Resorts Private Limited being a related party to the Company holds 100% equity shares of RHSPL. 

The company is currently engaged in the business of owning and running and rent-yielding fixed income assets through its malls and theatre properties.  As a part of the overall growth and diversification strategy and with a view to effectively channelize its available resources towards long-term income yielding assets, the company through its WOS proposes to acquire 100% shares of RHSPL, thereby owning a hotel property operated under the brand name Hyatt Centric in Candolim, Goa, the company further added.

The acquisition complements the business model of the company of owning and running marque real estate assets across segments. The company said that it will deploy its internal resources and shall not require any outside financial support/debt for completing this acquisition.

Subject to the approval of shareholders of the company, the enterprise value as agreed between the WOS of the company and the exiting shareholders of RHSPL is Rs334cr.

The final equity value of shares to be acquired shall be based on the acquisition date net debt position. It is currently estimated that the equity value of 100% of RHSPL is Rs94cr, the company said. Over and above the equiry value being paid to the selling shareholders of RHSPL, post-acquisition of RHSPL the company plans to infuse a further sum of upto Rs140cr into RHSPL towards repayment of certain secured and unsecured debt as well as for working capital as and when required, it added.

Cineline ended at Rs33.75 per piece up by Rs0.35 or 1.05% from its previous closing on the BSE.

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