Co. investing $183.5 mil in embattled exhib's debt
TORONTO — Exhibitor Onex’s takeover of the troubled Loews Cineplex and Cineplex Odeon theater chain was finally greenlit by antitrust watchdogs Monday after rival Famous Players sold its interest in Onex’s Galaxy theaters.
Onex, whose 2001 revenues were $15.1 billion, is investing $183.5 million in Loews Cineplex debt.
The takeover had looked like a shoo-in until a previous deal, too small to have caught the Competition Bureau of Canada’s notice, came to light.
Viacom subsid Famous Players, the country’s largest exhibitor, bought a minority share in Onex-controlled Galaxy Entertainment, a small theater chain specializing in small to mid-sized markets, two years ago.
With Onex’s takeover of Loews Cineplex, the country’s No. 1 and No. 2 theater chains would share an interest in a third chain — plus seats on the board of directors. That was too much for the Competition Bureau, an independent law enforcement agency ensuring that mergers don’t lessen or prevent a competitive business sector in the Great White North.
Famous Players sold its minority interest in Galaxy for an undisclosed sum on Friday.
“With the separation of Galaxy and Famous Players, the Competition Bureau concluded that control of Cineplex Odeon and Galaxy by Onex would not result in a substantial lessening of competition and allowed the transaction to proceed,” said a Bureau statement.