Pyramid Saimira to transfer 40% in arm to strategic partner

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Pyramid Saimira to transfer 40% in arm to strategic partner

PS Saminathan said that the he planned to list both the production and distribution arm of Pyramid Saimira, adding that he planned to transfer 40% of stake in production subsidiary to a strategic partner.

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Excerpts from After the Bell on CNBC-TV18 Watch the full show » ALSO READ See latest News about Pyramid Saimira See previous management interviews See what other Experts & Brokerages are saying about Pyramid Saimira Nifty BSE | NSE 09/02/12 Are Mutual Funds betting on Nifty?

PS Saminathan, MD, Pyramid Saimira , says the company plans to list its production and distribution arm. "We plan to transfer 40% of stake in production subsidiary to a strategic partner."

Saminathan says the company has converted around 15 lakh shares at Rs 350 per share. "These funds will be used for the exhibition sector."

Here is a verbatim transcript of the exclusive interview with PS Saminathan on CNBC-TV18. Also watch the accompanying video.

Q: Could you highlight the key pointers that came away from that board meeting?

A: We have discussed and decided two major issues in the board meeting. One is, our production subsidiary, Pyramid Saimira Production International Limited has managed to get a strategic partner and we are transferring around 40% of the stake to the strategic partner. He is also coming in as a co-promoter in our production subsidiary so that our unfinished films of around 17 can be completed. We have added a business plan for another 30 films to be started immediately.

Secondly, we are also announcing a demerger of our distribution subsidiary called Pyramid Saimira Content Distribution Pvt. Ltd., which so far has distributed more than 100 films, and did a topline of around Rs 250 crore during 2008-2009. We are demerging this from the main company, so as to give it its own feet and also make further financial closure. We will give PSPL shareholders free shares of Pyramid Saimira Content Distribution Pvt. Ltd. to them and also list the same by virtue of it going to more than 40,000 shareholders.

Q: The distribution company, so it is going to be about a 1:1 ratio, one share?

A: We are appointing the professional valuers and we will submit the details of the scheme as well as the swap ratio by September 15 with the stock exchanges.

Q: Would you be looking at listing this distributed company?

A: Yes, we will be listing both the production company and the distribution company because the shares held by PSPL will be distributed to the shareholders of PSPL in those two companies.

Q: In terms of the enterprise value for both of them?

A: The enterprise value for the production company is around Rs 450 crore. We are appointing a professional valuer to make a proper valuation for the distribution company.

Q: So, this strategic sale, the person who has pumped in money has put in about Rs 180-200 crore in your production company?

A: We have valued that and given on a phased valuation. The partner is putting in both the cash infusion as well as the property infusion into our production company in a phased manner. We will be announcing the name of the partner as well in the next press conference.

Q: Which should be around when?

A: By Monday.

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