Virgin may exit exhib biz

Conglom to sell stake, possibly whole

Richard Branson’s Virgin Group, which owns businesses ranging from airlines to a cola brand, said it’s considering selling a stake in its movie-theater unit. It might also sell the entire business, people familiar with the situation said Friday.

Virgin has been approached by entertainment companies and private equity firms, Virgin spokesman Will Whitehorn said. The company hired Deutsche Bank AG to advise on actions to take with the business, people familiar with the situation said. One person said the unit is worth about £200 million ($322 million). Virgin Cinemas has 34 theaters in the U.K., Ireland and Japan.

No firm decisions

“We want to accelerate the chain’s expansion, and may bring in a partner to facilitate this,” Whitehorn said. No decisions on the future of the unit has been taken, he said.

In April Simon Burke, the former head of Virgin Entertainment, of which Virgin Cinemas is part, said the company planned a £300 million expansion in the U.S. and Japan.

Burke resigned from Virgin in May to join Hamleys, a U.K. toy retailer. He was replaced by Simon Wright.

Whitehorn said another possibility is for Virgin to sell shares in the theater chain on a stock market. Virgin Cinemas was formed on 1995 when the company bought 119 theaters from Credit Lyonnais. It kept 19 of the cinemas and sold the rest.