Reliance Capital to acquire 51% stake in Adlabs Films

In a significant development, Reliance Capital, which is now controlled by Anil Ambani following a settlement with his brother Mukesh Ambani, will acquire a 51 per cent stake in Adlabs Films.

The Adlabs board, on June 30, agreed “in principle” to the acquisition, which will be done by a Reliance Capital subsidiary, Reliance Land, for a total consideration of Rs 350 crore. Reliance will offer Rs 175 per share as part of the acquisition.

Of the total amount, Rs 250 crore will be utilised for the expansion plans of the company, while the balance of Rs 100 crore will be paid to one of the promoters, Vasanji Mamania for diluting his stake.

At the moment, Mamania along with co-promoter Manmohan Shetty and associates have a 60 per cent stake in the company. Media house Bennett, Coleman & Co Ltd (BCCL) and Reliance Capital have a five per cent stake each, while the balance is held by foreign institutional investors (FIIs).

Shetty will continue to be the chairman of the company, though new people will be inducted in the management. His daughter Pooja Shetty, for the record, is a whole-time director at Adlabs.

The company, for the uninitiated, is a key player in the film processing business in the country. In the last few years, it has moved into film exhibition with the Adlabs chain of multiplexes, film production and digital cinema.

© 2005 agencyfaqs!