‘50% Market Share In 19 Cities’: Non-Profit Body Challenges PVR-Inox Merger

New Delhi: The Consumer Unity and Trust Society (CUTS), a non-profit entity, urged the Competition Commission of India (CCI) to conduct a probe into the “possible anti-competitive effects” of the proposed merger agreement between the two multiplex giants Inox Leisure Ltd and PVR Ltd. The public policy research group is said to have “filed the information” with the CCI and is awaiting to hear from the competition watchdog, the Business Line reported.Also Read – Multiplex Giants PVR, Inox Announce Merger, Subject to CCI’s Approval

“PVR-Inox is likely to become the largest player in 43 cities, with market share in excess of 50 per cent in at least 19 cities, consequently substantially increasing the concentration levels,” the Consumer Unity and Trust Society said in a statement. Also Read – Ranveer Singh’s 83, Akshay Kumar’s Sooryavanshi to Have Theatrical Christmas And Diwali Release

Such a large market power could result in “possible competition concerns”, the body further alleged, also raising concerns regarding the increased bargaining power that the merged entity would possess. Also Read – Inox Leisure allots shares worth Rs 160 cr to promoter

“The CCI has a duty to prevent and eliminate practices having an appreciable adverse effect on competition, promote and sustain competition, and protect the interest of the consumers,” said Pradeep S Mehta, Secretary General, CUTS. According to reports, the body also claimed that had it not been due to Covid lockdowns, the deal would not have qualified for exemption from mandatory merger review by the CCI.

In their BSE filing on August 3, PVR and Inox Leisure said a joint application for the Scheme of Amalgamation has been filed “under Sections 230 to 232 and other applicable provisions of the Companies Act, 2013, with the National Company Law Tribunal, Mumbai on August 2”. The proposed merger, which was announced in March, received clearances from BSE and NSE in June, reported the Business Line.