AMC Entertainment Holdings said on Tuesday it would buy London-based Odeon & UCI Cinemas Group to create the world's largest movie theatre operator, marking the first big deal by a US company to buy a British firm since the Brexit vote.
AMC, the second-largest movie theatre chain in North America, will buy Odeon from Guy Hands' private equity firm Terra Firma in a deal valued at about £921 million (€1.01 billion).
The deal would have cost AMC about €145 million more before Britons voted to leave the European Union, sending the pound crashing to a 31-year low.
It is also a vote of confidence by AMC in the UK economy, whose outlook has dimmed since the referendum.
"While we acknowledge that there are some uncertainties related to Brexit, we are encouraged that current currency rates are highly favourable to AMC with the pound falling to a three-decade low versus the dollar," AMC chief executive Adam Aron said.
Chinese billionaire
AMC, majority-owned by Chinese billionaire Wang Jianlin’s Dalian
Wanda Group
, would have 627 cinemas and more than 7,600 screens in eight countries after the purchase of Europe’s biggest cinema operator.
Odeon and UCI, which has 242 theatres and 2,236 screens, will continue to be based in London as a subsidiary of AMC.
AMC said it would assume £407 million of net debt as part of the deal, which is expected to close by December 31st.
The US company also said it was committed to closing its $1.1 billion acquisition of Carmike Cinemas, which was thrown into doubt after the smaller chain adjourned a shareholder vote on the deal last month. AMC said it would continue to work with Carmike this week to see if the deal could be saved, while acknowledging it was at “considerable risk”. Carmike shares were down 2.5 per cent at $29 in pre-market trading.
– (Reuters)
