|16 December, 2019

Cineworld pushes expansion with $2.1bln deal for Canada's Cineplex

Cineworld to fund deal through $2.3bln in debt

Workers repair a sign at a Cineworld cinema in Bradford northern England, March 24, 2016.

Workers repair a sign at a Cineworld cinema in Bradford northern England, March 24, 2016.

Reuters/Phil Noble

Britain's Cineworld announced a $2.1 billion takeover of Canada's Cineplex Inc on Monday which would make it the largest cinema operator in North America.

Cineworld has offered to buy Toronto-based Cineplex for C$34 ($25.56) per share, a premium of 42% to its close on Friday.

Shares in Cineworld were up about 1.4% in early trade.

The company said the $2.1 billion deal including debt would involve it seeking $2.3 billion in loans.

The deal comes nearly two years after Cineworld bought U.S.-based Regal cinemas for $3.6 billion.

It will add 165 cinemas and 1,695 screens to its global network of 9,498 screens across 786 sites.

"Our immediate post-acquisition objectives will be to combine Cineplex with our U.S. business," Chairman Anthony Bloom said. 

Cineworld said its largest shareholder Global City Theatres B.V. has agreed to back the deal.

The company also said it will continue the refurbishment of the Regal chain in the United States.

Cineworld listed on the London Stock Exchange in 2007 and is part of UK's midcap index.

Bank of America Securities, HSBC Bank and Goldman Sachs International acted as financial advisers.

($1 = 1.3301 Canadian dollars)

(Reporting by Tanishaa Nadkar and Pushkala Aripaka in Bengaluru; editing by Rashmi Aich and Jason Neely) ((tanishaa.nadkar@thomsonreuters.com; Within UK +44 20 7542 1810; Outside UK +91 80 6749 1691; Twitter: @TanishaaNadkar;))

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