PVR INOX Divests Premium Snacking Business 4700BC to Marico in Rs 226.8 Crore Deal
In a significant strategic move, multiplex operator PVR INOX announced on Monday that it has sold its premium snacking business, operating under the 4700BC brand, to FMCG major Marico. The all-cash transaction is valued at Rs 226.8 crore, marking a pivotal step in the company's efforts to monetize non-core assets and bolster its balance sheet.
Board Approval and Regulatory Details
The PVR INOX board has approved the divestment of its entire 93.27% stake in Zea Maize Pvt Ltd (ZMPL), the entity that owns the 4700BC brand. This decision was confirmed through a regulatory filing by the Bijli family-promoted company. Upon the completion of the transaction, ZMPL will cease to be a subsidiary of PVR INOX, as reported by PTI.
In a joint statement, both companies highlighted that "PVR INOX has monetised its entire investment in its subsidiary ZMPL to Marico Ltd in an all-cash transaction for a total consideration of Rs 226.8 crore." The multiplex giant has entered into definitive agreements for the transfer of equity shares to Marico, with a duly authorized committee of the Board of Directors overseeing the sale.
Strategic Rationale and Brand Overview
4700BC is recognized as one of India's leading premium gourmet snacking brands, initially gaining fame for its popcorn offerings and later expanding into categories such as popped chips, makhana, crunchy corn, and nachos. PVR INOX emphasized that this divestment aligns with its ongoing strategic review, stating that the transaction is expected to be accretive to profit, free cash flow, and return ratios. Importantly, the company assured that the sale will have "no material impact on PVR INOX's in-cinema food and beverage revenues or its growth trajectory."
Leadership Perspectives on the Transaction
Commenting on the deal, PVR INOX Managing Director Ajay Bijli described the sale as the natural culmination of the company's role in building the brand. He noted, "We recognised the potential in 4700BC at a very early stage and supported the brand through its formative years. From a niche gourmet popcorn offering, it has grown into a nationally recognised premium snacking brand. As it looks to scale further and broaden its ambition, the brand is well positioned under the stewardship of a scaled FMCG leader like Marico."
On the other side, Marico Managing Director and CEO Saugata Gupta expressed enthusiasm, stating that the acquisition fits well with the company's growth strategy in the food sector. He said, "The investment in 4700BC aligns well with Marico's ambition to participate in fast-growing food categories through distinctive, future-ready brands. We see immense potential in 4700BC as a premium snacking brand with deep consumer connect and proven execution."
Marico's Expansion Plans and Future Outlook
Marico, promoted by the Mariwala family and known for brands like Saffola, Parachute, and Livon, plans to leverage its existing scale in foods to expand 4700BC's presence across various channels. The company has set ambitious targets, expecting its food and premium personal care businesses to contribute 25% of domestic revenue within the next three years. Having crossed Rs 10,000 crore in revenue in FY25, Marico is now targeting Rs 20,000 crore by 2030.
Background on PVR INOX
Formed after the merger of PVR and INOX in February 2023, PVR INOX currently operates 1,783 screens across 357 properties in 112 cities in India and Sri Lanka. This divestment underscores the company's focus on streamlining operations and enhancing financial stability in a competitive market landscape.
