Adlabs buys Malaysian cinema chain

Written by Patrick Frater

Tuesday, 06 May 2008
Story Categories: Adlabs, Exhibition/theaters, Film, Finance, India, Malaysia,
HONG KONG – Indian group Adlabs Films has bought Lotus Five Star Cinemas, Malaysia's third largest cinemas chain.

Adlabs said that it had acquired a majority and controlling stake in the firm, but other deal terms were not disclosed.

Lotus operates 51 screens across the country and Adlabs said "the chain will have a footprint across Malaysia and will be playing mainstream Hollywood films as well as Chinese and Malay, in addition to movies in Indian languages such as Hindi and Tamil," Anil Arjun, Senior Vice President – Reliance ADAG, said.
Adlabs, a stock market listed subsidiary of privately controlled Reliance Entertainment and the Reliance Anil Dhirubhai Ambani Group, is rapidly building multiplexes to expand its 160 screen circuit within India and acquiring hardtop assets abroad. In March it announced that it had established a 220 screen circuit in the U.S. It also has cinemas in Mauritius and Nepal (Variety, March 27.)
"The company plans to venture wherever there is market for Indian movies, be it USA or Malaysia. The said acquisition was because there exists a huge market for Tamil movies," Arjun said.
Malaysia is one of the fastest growing theatrical markets in Asia, but remains significantly under-screened. According to government agency FINAS country had just 341 screens in mid 2007.
Lotus mainly runs small cinemas outside the biggest cities and has itself been adding properties over the last year. It terms of screen numbers alone it ranks behind Golden Screen Cinemas and TGV, in which Hong Kong's Golden Harvest was invested until last year, and ahead of Singapore-owned Cathay Cineplexes.

Adlabs' move is not the first into Malaysia by an Indian exhibition group. Early last year Pyramid Saimira, which operates over 250 screens in India, unveiled a joint venture with Malaysian company Asian Integrated Industries. As well as cinema ownership, that deal is intended to create a network of digital cinemas and provide them with distribution services.
News of Adlabs purchase of Lotus surfaced same day as stock market talk that Reliance Entertainment is seeking to sell a 10% stake for $500 million, implying valuation of $5 billion. That compares with the $3.3 billion the company was apparently worth in February when iconic financier George Soros paid $100 million for a 3% stake.

Adlabs' release slate for 2008 includes "Sarkar Raaj," "Singh is King," "Love Story 2050" and an animation featuring Tamil superstar Rajnikanth.

Last Updated ( Tuesday, 06 May 2008 )