Cineworld has announced plans to buy Canadian rival Cineplex in a deal that would make the UK cinema group the biggest in North America by number of screens.
Cineworld’s bid, which values Cineplex at $2.1bn including debt, would allow it to tap the $770m annual revenues from the Canadian box office, of which Cineplex has 75 per cent market share.
The acquisition, which will add 165 cinemas to Cineworld’s 786 sites, comes a year after Cineworld bought US chain Regal Cinemas in a $3.6bn deal. That made it the second-largest cinema group in the world, behind AMC theatres, which is owned by China’s Dalian Wanda and includes the UK chain Odeon.
Nigel Parson, analyst at Canaccord Genuity, said Cineworld was “determined to be predator rather than prey” as the industry consolidates in the face of competition from big-spending streaming platforms.
Pointing to deals such as Disney’s $71.3bn acquisition of Fox last year, Mooky Greidinger, chief executive of Cineworld, said “the name of the game now is consolidation”. However, he added that he did not see streaming as a threat. “If you are consuming Netflix or Amazon it is for the series,” he said. “You will rarely find someone say, ‘I am consuming this because of the movies’. Our main competition is not the streaming, it is the other forms of entertainment.”
Source: Cineworld to buy Canada’s Cineplex in $2.1bn deal | Financial Times