Cineworld Agrees To Buy Regal Entertainment For $3.6 Bln

UK-based Cineworld has agreed a $3.6bn acquisition of U.S. rival Regal Entertainment in a deal that will create one of the world's largest cinema chains.

The deal value of $23 per Regal share represents a premium of about 12 percent to Regal's closing price on Monday and implies an enterprise value - equity plus debt - of $5.8 billion.

Cineworld will gain opportunities for growth outside Britain, where consumer spending is falling ahead of the country's exit from the European Union. Movie-theater operators are stabilizing to extort costs and sustain reclining chairs and developed food-and-drink recourse to attract customers away from their Netflix binges at home. "The place to premier the big movies is in the cinemas".

Andy Miles, chief executive of Regal, said the offer from Cineworld "represents a meaningful premium" on its share price, while providing "compelling value for our stockholders".

According to Finviz reported data, The SMA20 of the stock is at 23.04 percent, SMA50 is 25.37 percent, while SMA200 is 8.8 percent.

Innumerable films this year have not been able to meet the expectations at the box office, and the summer season normally the most remunerative for the Industry was down, the worst since 2006.

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"When they go to the cinema, they go to the cinema and who loves to go to the cinema more than the Americans?", Greidinger told Reuters. Cineworld operates 2,227 screens in nations including the U.K., Ireland, Poland, and Slovakia.

The deal is valued at $5.9 billion including debt. Regal is controlled by the billionaire Philip F. Anschutz's Anschutz Corporation, which has agreed to support the deal.

Cineworld shares opened down 1.1 per cent on Tuesday morning.

The deal will give the companies $150 million a year in pretax savings and structural synergies, Cineworld estimates. The Anschutz Corporation, which owns approximately 67% of the combined voting power of Regal's outstanding shares of Class A common and Class B common stock, has signed a voting and support agreement to support the transaction. AMC has also bought London-based Odeon & UCI Cinemas Group, as well as Nordic Cinema Group, to expand its global presence.

The FTSE 250 company said the proposed deal, which is subject to shareholder and regulatory approval, would create the second-largest cinema operator by screen numbers, with nearly 10,000 between them now across 10 nations. The combination is also an attempt to meet the challenge of AMC, which has been spending to improving its cinemas - including the Odeon chain in the United Kingdom - since it was acquired by Wanda for $2.6bn in 2012. Regal unsuccessfully tried to sell itself in 2014.

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