Mexican cinema giant Cinepolis has fully acquired the assets of Fun Cinemas from Essel Group comprising 24 cinemas and 83 screens in India, marking its first acquisition in the territory having first entered the Indian theatrical sector in 2009.
The acquisition will boost Cinepolis’s screen count to 41 sites and 193 screens. It will also significantly strengthen the company’s existing operations in the two main hubs of Delhi and Mumbai. The acquisition raises the profile of Cinepolis to become the fourth largest operator in India, ahead of local company Cinemax.
The acquisition also forms part of wider strategy of Cinepolis to reach 400 screens in India by 2017.
The deal is significant as it marks the Mexican cinema circuits first acquisition in India which has seen its screen count approximately double. Cinepolis had previously employed its core strategy of mainly organic growth which has seen its screen count increase from just four in 2009 and 39 in 2012, to 79 in 2013. The deal therefore confirms that Cinepolis is committed to expansion in the Indian market to reach its target of 400 screens over the next two years, which would again see it more than doubling its screen count in the same time frame. Cinepolis will continue to run the cinemas as separate brands until it fully integrates the cinemas. Cinepolis is significant in the Indian market as the leading international circuit.
The Cinepolis acquisition also follows a flurry of activity in the Indian theatrical market following the buyout of Big Cinemas by Carnival Films for a reported total of Rs700 crore in late 2014. Big Cinemas has approximately 280 screens as the third largest operator, behind market leader Inox (361 screens) and PVR (316 screens) as at H1 2014. Also in 2015, Stargaze Entertainment acquired a stake in Carnival Films that was formerly owned by Network18.
The aggressive expansion plans for Cinepolis in India are on a similar scale to those formerly announced by Inox Lesiure to reach 500 screens over the next two years. The rate of expansion will continue the process of consolidation by the top five exhibitors in India which has risen from just 7.1% of total screens in 2009 up to 13.1% of the total screen base as at end 2014.
For Cinepolis too, the deal is also the second major acquisition of 2015 (although the Fun Cinemas deal was reportedly closed in late 2014), after it acquired the assets of Cine Hoyts in Chile, marking its first foray into the Chilean market. The deal will see Cinepolis become the largest circuit in Chile, equally on 144 screens with rival US and International circuit Cinemark.
On a global basis, the inclusion of Chile now brings Cinepolis’s total to 12 international markets including the USA, Mexico and Brazil. It has a total of 411 cinemas active with 3,563 screens as at end 2014. Cinepolis has been actively investing in premium tiered cinemas and this total includes 217 VIP screens and 39 Xtreme screen, the company’s own PLF brand internationally. In India, there are a total of seven VIP screens, although the circuit has yet to introduce its PLF brand into the market.