Facing blowback from investors, Carmike Cinemas postponed a shareholder vote Thursday on the theater chain’s potential $1.1 billion sale to AMC Entertainment. Some analysts and stock watchers expect that AMC could sweeten its deal, but AMC chief Adam Aron hit back at suggestions that his company’s proposal undervalues Carmike. He hinted that AMC might walk away from the table.
“AMC Entertainment remains committed to our proposed transaction to acquire Carmike Cinemas,” he said ” The rationale to acquire Carmike continues to be valid, namely to create a larger system of theaters nationwide.”
Aron added: “Even so, this transaction is now at considerable risk.”
Aron went on to decry “loose price talk” in the market, saying the critics of the deal failed to account for tax implications from the pact and other transaction costs in pushing for a higher price. One of the leading opponents of the pact is Driehaus Capital Management and Mittleman Brothers, which together control nearly 20% of Carmike’s votes.
A union with Carmike would make AMC the biggest theater chain in the world, bypassing Regal and giving it well over 600 theater locations in 45 states across the country, including the District of Columbia. AMC was itself acquired in 2012 by China’s Dalian Wanda Group for $2.6 billion.
Carmike investors will reconvene on July 15.