Rel Media makes counter bid for Fame at Rs 83.40 a share

Recently, Inox Leisure had signed an agreement to acquire 43.28% promoter’s stake in Fame India and earlier this month made an open offer to buy another 20% stake, at a price of Rs 51 per share.

At present, three Anil Ambani group firms — Reliance MediaWorks, Reliance Capital Partners and Reliance Capital — together hold about 10.26% stake in Fame.

In a public notice, Reliance MediaWorks said it would make an open offer to acquire 52.48% in Fame India.
Sources said the decision to make the open offer was made at a board level meeting held on Saturday.
When contacted, an ADAG spokesperson declined to comment. The open offer is made for 2.16 crore shares at a price of Rs 83.40 per piece, much higher than that offered by Inox.

Interestingly, Inox’s open offer for 20% additional stake in Fame is priced at Rs 51 per share. Inox has 42.68% shareholding in the multiplex chain operator.

If the open offer is successfully completed, Reliance group would have a total stake of 62.74% in Fame India.
Earlier this month, Reliance MediaWorks had said it would seek action against Fame for selling promoters’ stake in the theatre chain to Inox at a price much lower than it had offered earlier. Reliance MediaWorks also pointed out that it had offered to acquire the promoter’s stake in Fame India for Rs 80 a share, “representing an almost 100% premium to the prevailing market price”.

Meanwhile, according to the public notice, on completion of the open offer, Reliance MediaWorks, along with group companies Reliance Capital Partners and Reliance Capital, would have at least 2,58,24,435 equity shares of Fame. This would represent “74.22% of the fully paid up equity share capital of Fame India and 62.74% of its emerging equity share and voting capital”, the notice said.

The offer is made on a voluntary basis and is subject to regulatory approvals. Reliance MediaWorks said the offer to get control of Fame would help it consolidate its position in the movie exhibition industry.

The notice adds that after the acquisition, Reliance MediaWorks would continue to support Fame’s board of directors “in their endeavour to develop the business”.