LONDON — The U.K.’s largest exhibition chain Cineworld Group is to merge with Cinema City Intl., a leading loop in seven countries across Central and Eastern Europe and Israel, in a deal worth around £503 million ($825 million).
The deal will create the second largest movie theater business in Europe with the number one or two market share — by number of screens — in every region of operation. The enlarged group will have 201 sites and 1,852 fully digital screens.
Cinema City brings attractive growth opportunities in developing economies and markets in which multiplex screen penetration is relatively low, with low admissions per capita, high population per screen and low average ticket prices. The business has experienced strong growth with 2009-2012 revenue of 14.2%, and has a strong pipeline of screen openings in place to capitalize on further growth.
The new management team will combine representatives from both Cineworld and CCI: Anthony Bloom will continue as chairman of the group; Mooky Greidinger, the chief executive officer of CCI, will be appointed as CEO; Philip Bowcock will remain as chief financial officer; and Israel Greidinger, the chief financial officer of CCI, will be appointed as chief operating officer.
The new board will comprise of 10 directors, of which six from the existing Cineworld board together with Mooky Greidinger and Israel Greidinger, and two new non-executive directors: Scott Rosenblum (CCI’s chairman) and Arni Samuelsson (a new independent director).
Bloom said: “This is an exciting and unique opportunity for Cineworld to offer shareholders enhanced growth prospects and attractive returns via exposure to some of the most promising cinema markets in Europe.
“Cinema City is an extremely well-run and dynamic business, which creates a platform for further growth in future. Mooky Greidinger will be joining us as CEO — he is a highly respected and very experienced cinema executive who enjoys international recognition.”
Mooky Greidinger said: “After nearly four decades in the cinema industry building a business from one country to seven, I see an impressive company in Cineworld and a good fit with Cinema City.
“Together with the rest of the proposed management team I intend to seize this opportunity to bring together two equals in size, both leading players in their respective countries, and lead the resulting business to continuing growth, innovation and dedication to the best possible customer experience.”