India’s movie theatre chain companies, PVR Limited and Inox Leisure, Limited, announced their merger on Sunday.

It was also decided that Ajay Bijli, chairman and managing director of PVR, will be the managing director of the combined entity. The reconstituted board will have 10 members with Inox and PVR having equal representation.

“The film exhibition sector has been one of the worst impacted sectors on account of the pandemic and creating scale to achieve efficiencies is critical for the long term survival of the business and fight the onslaught of digital OTT [over the top] platforms,” he said.

The combined entity will be named “PVR INOX Limited”, while new cinemas opened post the amalgamation will be branded as “PVR INOX”.

“The combined entity will become the largest film exhibition company in India operating 1,546 screens across 341 properties in 109 cities,” the statement by Inox read.

The amalgamation is subject to shareholders’ approval of both companies, stock exchanges, the Securities and Exchange Board of India and other regulatory bodies, according to a release issued by Inox.

Once the merger is successful, Inox promoters will have a 16.66% stake while PVR promoters will have a 10.62% stake in the combined entity. Also Inox shareholders will receive shares of PVR at the approved exchange rate.

“Accordingly, Inox shareholders will receive 3 shares of PVR for 10 shares of Inox,” the release said.