MADRID — Terra Firma Capital Partners, owner of Spanish cinema chain Cinesa, is negotiating to buy Warner Lusomundo Sogecable Cines de Espana, Warner Bros.’ cinema circuit joint venture in Spain.
Warner’s loop has been on the block for months, though no deal has closed, and Brit investment fund Terra Firma might not be the only company pursuing it.
WLS and Cinesa already have a joint programming strategy.
Terra Firma made aggressive moves in exhibition last year, buying large U.K. theater chain Odeon Cinemas. It then purchased UCI Cinemas’ European ops from Vivendi Universal and Viacom for E270 million ($351.2 million) in October.
Squeezing exhibs’ margins, average yearly takings per screen in Spain have tumbled as cinema construction continues, while B.O. growth faltered in 2002 and 2003.
“The market expected this. It’s logical. It’s happened in the U.K. Concentration in exhibition exploits economies of scale,” said a Spanish exhib exec.
WLS and Terra Firma were not available for comment.
Separately, Spain’s Vocento and Recoletos and Portugal’s Sonae Com and Cofina have presented bids for Lusomundo Media, whose assets include three daily newspapers and a radio station, TSF.
Cofina already owns a 19% stake in Lusomundo Media. The current owner, Portugal Telecom, has set a deadline of Feb. 14 for bids and expects to close the sale by the end of March.
(Martin Dale in Lisbon contributed to this report.)