Cineworld Group plc Acquisition of five cinemas (4556F)
July 28 2016 - 1:02AM
UK Regulatory
TIDMCINE
RNS Number : 4556F
Cineworld Group plc
28 July 2016
28 July 2016
Cineworld Group plc
Acquisition of five cinemas
Cineworld Group plc ("Cineworld" or "the Group") today announces
the acquisition of five cinemas from Cinema Holdings Limited, the
holding company of Empire Cinema Limited ("Empire") and the sale to
Empire of the three screen Cineworld Haymarket ("the Transaction").
Cineworld will pay Empire an aggregate consideration of 94 million
GBP(1) for the Transaction.
The cinemas purchased are:
-- the nine screen Empire Leicester Square multiplex, a leading
London West End venue for movie premieres, which has a Laser IMAX
screen,
-- an 18 screen multiplex in Basildon, which has an IMAX screen,
-- a 17 screen multiplex in Hemel Hempstead, which has an IMAX screen,
-- a 16 screen multiplex in Poole, which has an IMAX screen and
-- a smaller four screen cinema in Bromley in Greater London
In recent years, extensive investment has been made into this
portfolio. EBITDA for the twelve months to 31 March 2016 was
GBP9m(2) , which includes only a partial contribution from
additional screens, and the UK's first IMAX Laser in the Leicester
Square multiplex, all of which were only opened part way through
the financial period.
The Directors believe that the Transaction will be marginally
earnings enhancing for Cineworld within the current financial year
and provide high single digit earnings enhancement in 2017,
including some anticipated synergies. The 2017 growth will benefit
from the full contribution of the new screens opened in 2015 and
2016, which are not reflected in the historic EBITDA
performance.
The consideration for the Transaction will be 50% cash and 50%
new ordinary Cineworld shares. The shares will be issued to Empire
in 5 instalments during a 12 month period, based on an issue price
reflecting 20 days' average trading price prior to the date of each
issuance. The Transaction is unconditional and is expected to close
before the end of August 2016. Cineworld will be notifying the
Competition and Markets Authority ("CMA") of the Transaction on a
voluntary basis. The timetable for completion will not be affected
by the notification to the CMA.
The Leicester Square, Basildon, Hemel Hempstead and Poole
cinemas will take on Cineworld branding, while management is
considering converting the Bromley cinema into a Picturehouse to
make optimum use of its size and location. No further material
capex is required due to the investment in the portfolio in recent
years, and all the multiplexes are modern with state of the art
equipment.
Cineworld will announce interim results for the period to 30
June 2016 on 11 August 2016.
Mooky Greidinger, Chief Executive Officer of Cineworld,
said,
"This acquisition brings Cineworld five modern and well invested
venues complementary to our existing estate, including the iconic
Leicester Square cinema in the heart of London's West End. It
underscores our commitment to operating high quality and modern
cinemas across all of our nine operating countries, and our mission
to be the best place to watch a movie. I'm delighted that the
Anderson family, well-known cinema industry veterans, have
entrusted these sites to us. We welcome them as shareholders in
Cineworld and look forward to delivering increased returns to all
of our investors from integrating these cinemas into our
group."
Thomas Anderson, Chairman of Empire, said,
"I'm pleased to have found the ideal partner in Cineworld to buy
these sites. Their reputation as good operators gives me confidence
in a bright future for the cinemas and their employees, and as a
shareholder in Cineworld, I trust the company's ownership will
enable it to maximise the value of these premium assets as part of
its continued growth."
1 Subject to customary adjustments
2 Extracted from management accounts for the twelve months to 31
March 2016
3 The shares issued as consideration are subject to a lock-up of
12 months from the date of completion
For further details please contact:
Cineworld 020 8987 020 3772
Group plc 5000 Bell Pottinger 2573
Israel Greidinger Elly Williamson/Zara
de Belder
This announcement contains inside information for the purposes
of Article 7 of EU Regulation 596/2014.
About Cineworld Group plc
Cineworld Group plc was founded in 1995 and listed its shares on
the London Stock Exchange in May 2007.
The company has grown organically and by acquisition to become
one of the leading cinema groups in Europe with the number one or
number two position by number of screens in each of its regions.
Cineworld currently operates 2,049 screens across 221 sites in the
UK, Ireland, Poland, the Czech Republic, Slovakia, Hungary,
Bulgaria, Romania and Israel.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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