Capex of US $ 150 mn for Scrabble’s international growth plans
BestMediaInfo Bureau | Delhi | September 30, 2011
UFO Moviez India Ltd., the world’s largest satellite delivered digital cinema network promoted by the Valuable Group, has committed an investment of Rs. 200 crore to fuel the growth and expansion plans in India of Scrabble Entertainment (Pvt) Limited, in which UFO Moviez has recently acquired a controlling stake. The international roll out plans of Scrabble Entertainment will entail a capex of US$ 150 million to be funded by way of international debt and further equity infusion by UFO Moviez.
Kapil Agarwal, Joint Managing Director, UFO Moviez, says, “The UFO-Scrabble combine is the only alliance in the world that offers non DCI satellite based digital cinema solutions as well as DCI-compliant solutions with VPF (Virtual Print Fee) deals to the global and Indian film industry. By acquiring majority stake in Scrabble, UFO Moviez has reiterated its commitment to ensuring that the Indian film industry ecosystem benefits from the resulting cost-efficiency and increased reach of content by taking Hollywood content to cinema lovers across ‘Bharat’ and beyond its metros. We shall ensure that this Indian combine started by first generation entrepreneurs now goes global.”
Ranjit Thakur, CEO, Scrabble Entertainment, said, “Scrabble is happy to partner with UFO Moviez, an organization that has changed the landscape of the film industry in India by offering innovative technology solutions for its betterment and growth. We look forward to ensuring that more and more audiences across India can now enjoy high quality films on a digital platform”.
UFO Moviez India has recently acquired a majority stake of 52% in Scrabble Entertainment. Post this, Dr. Sunil Patil and Ranjit Thakur presently own 27% stake totally and the balance equity is held by Walkwater Media Ltd., owned by Manmohan Shetty.
Scrabble Entertainment, a Mumbai based first generation company promoted by Dr. Sunil Patil and Ranjit Thakur, is the only aggregator in India which has Virtual Print Fee (VPF) rights from Hollywood studios for providing DCI (Digital Cinema Initiatives) compliant solutions.
Scrabble Entertainment has already signed VPF deals with Hollywood studios and is now ready to go global in 10 countries in the Middle East and Eastern Europe (UAE, Oman, Qatar, Bahrain, Kuwait, Syria, Jordan, Lebanon, Cyprus and Bulgaria). It is also looking very enthusiastically at expanding its footprints in Latin America (Brazil, Argentina, Chile and Mexico). Scrabble expects to install around 2000 screens internationally in the next two years, out of which deals for over 600 screens in the Middle East have already been finalized.
In terms of the domestic market, the UFO-Scrabble combine will now increase the number of DCI compliant cinemas from 300 (that Scrabble has presently installed in around 30 major cities since its inception in 2007) to 800 (single screens as well as multiplexes) within six months. This will ensure that cinema viewers in Tier 2 and Tier 3 cities in India will now get a chance to watch Hollywood content because the six Hollywood studios only give content to DCI compliant platforms.
The timing of UFO acquiring majority stake in Scrabble is significant because it is important for the Indian film fraternity to make this transformation and transition to DCI compliance quickly, as the six Hollywood studios are likely to stop providing analogue prints over the next couple of years. The VPF model is important as it allows Scrabble to provide DCI solutions at a highly subsidized cost. Each DCI equipment installation requires an investment of around Rs. 30 lakh and Indian cinema owners, especially single screens find this cost to be prohibitive. The UFO-Scrabble alliance will provide DCI solutions by way of a unique business model that will result in cost-effectiveness and cost-efficiency for all the film industry constituents (exhibitors, distributors, etc).