Tag Archives: Cineworld

Daily Cinema Digest – Friday 4 April 2014

Dreamloungers

We have written a lot about the cinemas in Fargo, North Dakota in the Daily before (here, here, here and here), but it is an interesting microcosm of the evolution that the US exhibition industry as a whole is going through.

This article highlight changes that three of Marcus Theatres’ Fargo properties are undergoing.

Century Cinema

The current big screen at Century Cinema, located at 3931 9th Ave. S.W., has just been converted to an Ultra Screen DLX with Dolby Atmos Sound.

That auditorium and all of the other auditoriums at Century Cinema are getting new DreamLounger chairs. According to Menefee, the chairs allow for full reclining, “Just like you’d have at home.”

The size of the DreamLoungers mean each auditorium at Century Cinema will see its seating capacity drop by about 40 percent, but Menefee said the popularity of the chairs should keep auditoriums full.

So fewer seats but higher comfort (and ticket price?) for the new seats in this USD $1.2 million upgrade

West Acres Cinema

As part of its makeover of the West Acres Cinema, Marcus Theatres is pursuing a liquor license for the site. If approved, the company plans to build a Take Five lounge where adult beverages would be served.

When the idea for a theater drinking lounge was discussed earlier this year at a liquor control board meeting, a number of city officials and city residents expressed doubts about the plan.

Menefee said if the lounge plan is approved, West Acres Cinema also will get a Zaffiro’s Express, a small restaurant that will serve pizza, sandwiches, salads and desserts.

So bar and cine-dining are on the menu in this $700,000 upgrade.

Safari Theater

Last year, Marcus Theatres indicated the Safari 7 Cinema, located at 925 30th Ave. S., in Moorhead, was up for sale.

The theater shows second-run movies on 35mm film at discounted prices.

Marcus Theatres was looking to sell the property because it did not want to incur the cost of upgrading the theater to show movies in digital format.

At present, the property is not for sale, and Marcus Theatres is in the process of reviewing possible enhancements for the theater, Menefee said.

What those improvements are Marcus won’t reveal just yet, but to keep going it will need digital projectors.

Business

Hayden Orpheum in Cremorne

Australia: Cinema tickets are getting more expensive Down Under. But there is also a growing trend towards discounting in order to drive sales.

In what could a psychological barrier for movie-goers, the top price of an ordinary cinema ticket has hit $20.

Two Sydney cinemas have pioneered the price increase — the Cremorne Orpheum and Palace Norton Street in Leichhardt — and others are expected to follow around the country soon.

“It’s just a question of a short period of time,” said the chief executive of Palace Cinemas, Benjamin Zeccola, who blamed increases in wages, rent and maintenance and energy costs.

“Ticket prices need to keep pace with rising costs. It’s horrendously expensive running cinemas.”  LINK

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Daily Cinema Digest – Tuesday 18 March 2014

is arthouse the new event cinema

SampoMedia asks if art-house films are the new event cinema. Given the recent complaint of the New York Times film critic Manohla Dargis that too many independent films get released, the question of how to stand out in a crowded marketplace that anyway competes with other entertainment platforms for time and money is a relevant one.

After being blithely dismissed as mere ‘alternative content’ – until people started going – the film industry has come to see opera more as an oversized cuckoo in an already crowded nest.

But in recent months, a different and more optimistic view is emerging. To borrow the politically-incorrect phrase, the ‘fat lady singing’ doesn’t mark the end of an era but the opening of a new one.

In short, a number of projects are beginning to test the idea that the best option for arthouse film is to take a leaf from the libretto of opera.

Several interesting examples are provided, including IFFR Live! and Curzon’s one-night-stand double bill preview of Nymphomaniac. Worth reading. LINK

CinemaCon

Las Vegas: This year’s CinemaCon is tracking to be bigger than last year’s. We will of course be covering it on the ground.

CinemaCon formally announced a five % increase in attendance over its 2013 show at the same point 11 days before each convention. CinemaCon, the official convention of the National Association of Theatre Owners (NATO), runs March 24-27 at Caesars Palace in Las Vegas.

“On the heels of two straight record years of time at the box office, the busy & crowded convention reflects the confidence, energy & diversity of the movie distribution & exhibition community,” asserted NATO president & CEO John Fithian.

For the third straight year, all seven major Hollywood studios will present movie screenings or star-packed previews of their upcoming slates.  LINK

Law

Cinema where man was killed

USA (TX): A man was killed outside a multiplex over an argument about the ending of 300: Rise of an Empire

A man who argued with two other movie goers about the ending of a film was struck outside the cinema by a truck driven by his adversaries and killed, the Harris County Sheriff’s Office said on Monday.

The men’s discussion of the film grew more heated as the three left the theater and went to the parking lot after the late Sunday evening film. Two of the men then got into a pickup truck.

“The driver of the truck put the vehicle in reverse striking the victim and knocking him to the ground,” it said. The truck then sped away.  LINK

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UK Cinemas Are High Profile Targets For Anti-Sugar Campaigns

concession table UK

Calorie and sugar levels in UK cinema snacks

Having looked at challenges facing United States exhibitors relating to carbonated sugar beverages (Cinema’s Dangerous Addiction to Sodas), it is now time to examine the situation in the United Kingdom. The issue has come to the forefront with an article in the Daily Mail’s This Is Money section titled “The 35 teaspoons of sugar in a box of cinema popcorn: Cinemas slammed over supersized snacks“. The piece highlights the amounts of sugar found in the concessions offering of the UK’s Big Three (Cineworld, Odeon and Vue).

Coming hot on the heels of the new recommendations from the World Health Organization (WHO) to cut daily intake of sugar by half, the statistics in the Daily Mail’s article make for sobering reading. Effectively a UK cinema goer could consume his or her entire weekly sugar “allowance” in just one cinema visit, if they buy a soda and a popcorn. From the article:

A 200 gram box of toffee popcorn at Cineworld comes in at 840 calories and 121 grams of sugar, equivalent to about 30 teaspoons. Adding a 32oz Coca Cola carries an extra 407 calories and 101.2 grams of sugar, or 25 teaspoons.

A large bucket of sweet popcorn at Odeon cinemas amounts to 1,005 calories, which is more than half of a woman’s recommended daily intake. And at Vue, a 200 gram tub of toffee popcorn contains 138.9 grams of sugar, which is equivalent to about 35 teaspoons.

UK’s Weight Watchers has thrown its, um, weight behind this criticism, with a call to ban ‘super sized’ serving portions, as part of its ‘Slim Our Snacks’ campaign. Quoted in The Mirror:

Actress Patsy Kensit, 44, who is 9 stone (126 pounds or 57.2 kilos) after shedding 14 pounds with Weight Watchers, said: “The full-sugar fizzy drink and popcorn sizes are ridiculous.”

WeightWatchers’ Zoe Hellman said film fans should not be faced with “blockbuster-sized sugary and fatty foods”.

Cinemagoers Enjoying Concessions

While in the Daily Mail article:

Weight Watchers spokesman Angharad Massie said: ‘Cinemas are inherently family focused spaces, yet we all recognise them to be one of the worst spaces for promoting portions of high fat, salt and sugar snacks with little or no choice of healthier alternatives.’

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Daily Cinema Digest – Thursday 6 March 2014

Screenshot 2014-03-06 15.34.10

UK: Cineworld Didsbury near Manchester has allegedly had some particularly unwelcome visitors recently: cockroaches. More worryingly, some staff claim the cinema is hushing up the issue:

The M.E.N. [Manchester Evening News] was alerted by a concerned member of staff, who said cockroaches had been a long-standing problem.

The worker, who also claimed staff were told to keep quiet about the outbreak, said: “Customers have seen them. Staff have raised it lots of times but they have been told that they have to keep quiet. Staff have complained to managers but have been told not to say anything to the wider public.

“The cinema hasn’t closed once. Cockroaches have been seen in the food area and the bar. I have seen them crawling in a sink. It is absolutely disgusting and we have to work in it.”

The cinema wouldn’t comment on claims that its staff were told to keep the outbreak under wraps.

Apparently it is not the first time that pest control has been called in to the 11-screen multiplex, though the cinema’s management claim to be on top of the situation, as quoted in M.E.N.:

They said they are ‘confident’ the outbreak is fully under control and would be ‘resolved shortly’.

Bosses said health and safety was of ‘utmost importance’.

Manchester city council said it was informed by the cinema of a ‘low-level infestation’ last October.

Cineworld Didsbury’s own website boasts:

Cineworld Didsbury contains licensed bars, perfect as a breakout space for meetings or a drinks reception to round off the day. Our professional caterers can provide anything from pastries on arrival to a full hot buffet, and we can offer fantastic corporate deals on refreshments.

Let’s hope the cleaning staff and routines are equally up to scratch. . LINK

Business

UK: Cineworld hasn’t had the best of quarters, with profits dragged down by the merger with Picturehouse (more on that in the next item).

Britain’s largest cinema operator Cineworld Group Plc <CINE.L> said full-year pretax profit fell 19.3 percent, hurt by transaction and reorganisation costs related to a recent acquisition and a regulatory probe.

Cineworld said pretax profit fell to 30.9 million pounds ($51.7 million) in the year ended December 26, from 38.3 million pounds a year earlier.

Revenue rose 13.2 percent to 406.1 million pounds at the only listed cinema chain in the UK.  LINK

UK: Cineworld has had to sell one of its cinemas in Aberdeen over competition issues related to the Picturehouse Cinemas takeover:

But today, Aberdeen City Council once again announced that the Belmont Cinema would be taken over by new bosses.

Centre for the Moving Image (CMI) are the parent company of the Edinburgh-based Filmhouse cinema and will begin operating the Belmont from the start of next month.

The move comes after Cineworld, who own the Picturehouse Cinemas group, were forced to sell one of their Aberdeen properties by the Competition Commission.

An Aberdeen City Council spokesperson said: “We can confirm that The Centre for the Moving Image, which manages the Filmhouse in Edinburgh and the Edinburgh International Film Festival, has been selected as the preferred bidder for the operation of the Belmont Media Centre.  LINK

UK: An independent cinema in Norfolk is abolishing its Monday promotion (GBP £3) and instead cutting the prices on all shows to just GBP £4.

Film fans will soon be able to see the latest screenings at a reduced price – thanks to Lynn’s Majestic Cinema’s bid to support businesses by bringing crowds back to the town centre.

Cutting the standard price of tickets by more than a third, the team are hoping to encourage more to venture into the town centre to watch the latest releases on the big screen.

Manager Tom Cundy said: “We want to offer a price that is affordable to everyone, we think our prices are already good but now we want to encourage more people to come back to the town centre.

An interesting and bold experiment. One that we will track. LINK

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Daily Cinema Digest – Thursday 20 February 2014

Screenshot 2014-02-20 14.50.11

Econsultancy has done a good job of comparing and reviewing the ticket booking customer interfaces of UK’s three leading cinema chains: Cineworld, Odeon and Vue. This review has relevance for ticket booking experience over the web for every country, even though restricted to just three in one territory. The author compares the web and mobile portals for ease-of-use, speed of booking, seat selection, repeat use and payment options. While it is worth reading the whole review, including the good use of screen shots, we won’t spoil your fun by revealing that Odeon fared worst, while Vue did well but Cineworld scored highest of the three. Link.

Technology

Laser projection: News from the HPA Tech Retreat by THR’s Carolyn Giardina that laser projection may have cleared a regulatory hurdle in the US. “Speaking at the HPA Retreat, Lude reported that international standards body International Electrotechnical Commission (IEC) “is well on its way to redefining what a laser projector is,” meaning that laser projectors would no longer be considered a laser emission device. Instead, they would fall under lamp regulation, possibly as early as spring, he said. In the U.S. this classification would eliminate the need for a variance to use a laser projector, and so LIPA is encouraging the FDA to quickly adopt the IEC revision (when completed).” Good news for brighter 3D pictures. Link.

India/subtitling: Digitisation has leading to falling costs for subtitling, which in turn allows for wider distribution of (non-Hindi/Bollywood) Indian films. “Producers are learning that a film’s market widens with some investment in subtitling. Until recently, subtitling was a sidelined function in moviemaking and dominated by the NFDC (National Film Development Corporation of India). Sanjay Wadhwa of AP International, a leading distributor of Tamil films in overseas markets, said after the rise of India’s software industry, there are numerous requests to subtitle films from the West. ”Initially, we were unable to do so because the cost of subtitling then was about Rs 75,000 per print—more than the cost of the actual print,” says Wadhwa.” Link.

Politics

India: It is election year in the world’s most populous democracy and politicians in southern Indian state of Tamil-Nadu are busy currying favours with voters, including the promise of cheap or free cinema. “As the ticket charges are high in most of the cinema halls in Chennai and since many of them are being operated from commercial complexes, the Chennai Corporation would establish cost affordable cinema theatres to provide entertainment to people. Vacant spaces available at various places at Corporation of Chennai would be identified and ‘Amma Cinema Theatres’ would be established for the benefit of poor and middle class people.” Far from being ‘high’ even by Indian standards, ticket prices are regulated and capped by the Tamil state. Link.

Liquor licence

USA: Marcus Theatre’s plans to serve alcohol in its Fargo cinema is running into some local resistance. “Serving alcohol in one of the city’s major first-run movie theaters might be a tough concept for some here to swallow. But even if city officials sign off on the plan, a cut rate on the liquor license the theater owner proposed appears to be a total flop.” Link.

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2013 – Bad Year for Film; Great Year for Exhibitor Share Price

It may seem paradoxical, but while 2013 was a bad year for films in terms of growth, it was an excellent year for cinemas. Even with a strong summer at the box office, 2013 was flat or even down compared to the previous year in most western countries. Only emerging markets like China showed strong and significant growth on the back of their multiplex expansions.

It would seem logical that this trend would be reflected in the share price of listed exhibitors, but analysis by CelluloidJunkie.com has found that major exhibitors in the four largest English-speaking territories (USA, Canada, UK and Australia) had one of their best years ever in terms of share price. We will examine this, as well as looking at the possible causes and outlook.

We first have to preface the analysis by noting that it is difficult to make a completely accurate like-for-like comparison. While the majority of the largest exhibitors in the US and Canada are publicly traded (Regal, Cinemark and Cineplex are, while AMC is privately owned by China’s Dalian Wanda Group), the same is not the case in UK, where only one of the Big Three is listed (Cinemaworld; Odeon-UCI and Vue are privately held), whereas in Australia the multiplex chains are privately owned (Hoyts) or have complicated joint ownership or subsidiary status (Village and Greater Union/Event Cinemas).

Even so, it is still possible to get a good idea of how markets value exhibitors and why 2013 was a good year for them, as we will see.

USA and Canada

2013 was a flat year in terms of box office growth. Statistics from BoxOfficeMojo tell us that overall gross was $10.925 billion, compared to $10.823 billion the previous year. While up by $100m year-on-year, this “growth” is effectively cancelled out by inflation. The underlying ticket sales are likely to show a decline when the official statistics are published by the MPAA. Projecting an annualized rate The Numbers sees attendance fall from 1.36bn to 1.19bn between 2012 and 2103.

This decline is in-line with what was predicted ahead of CinemaCon last year. Reported in Deadline:

“Bond analysis firm Fitch Ratings forecasts a “modest” decline in 2013 ticket sales and long-term challenges that should “cause concern” for lenders. Studios will find it “difficult to replicate” the success they had last year with hits including The Avengers and The Dark Knight Rises, analysts Shawn Gannon, Rolando Larrondo and Mike Simonton conclude. In addition the 3D market is “starting to mature.””

All-in-all you would think that it would have been good to short stocks in exhibitors, but you would have been wrong.

Screenshot 2014-02-14 15.07.12

Regal Cinemas went from strength to strength as the share price rose from just under $14 per share in January 2013 to close to $20 per share at the start of 2014, before slipping down closer to $19 recently.

Screenshot 2014-02-14 15.15.21

Meanwhile competitor Cinemark started the year below $27 and ended it above $33, before currently landing just above $30. Not as strong as Regal’s growth, but still significant.

Screenshot 2014-02-14 15.12.09

North of the border, Cineplex pulled off the most impressive stock market feat of them all by increasing from C$32 to coming within a whisker of C$45 before declining to just over C$40.

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Daily Cinema Digest – Tuesday 4 February 2014

Shankweiler's Drive-In Theatre

USA: Drive-in cinemas have become the twin victims of the end of analogue film and changing social habits that has mostly de-linked automobiles from cinema-going, other than as a mode of transport to the multiplex. So this is a lovely exception: Americas self-proclaimed oldest drive-in cinema is going digital with technology from GDC, Christie Digital and Ballantyne Strong. “Shankweiler’s Drive-in Theatre, the oldest drive-in movie theater in the United States opened up for its 80th season in April last year. The theatre’s owners, Paul F. Geissinger and his wife, Susan, have been upgrading the theatre throughout the past three decades and successfully turned it into a Pennsylvania hangout for people of all ages during the summer months.” I wonder if they had original Model-T Fords at their first screening. Link (PDF)

Cinema Opening/Closings

UK: “A £3m market hall built in 2008 could be closed and a multi-screen cinema built in its place with up to £100,000 spent to re-locate traders.  A proposal to Wakefield Council would see Wakefield’s Market Hall replaced by the cinema and a number of restaurants.” Link

UK: “Work beginning on the county’s first 11-screen cinema has been hailed as a “coup” by a community leader. Following a delay until after the Christmas period at the request of traders, building started yesterday on Cineworld at Broughton Shopping Park. The development will include several restaurants and a new bus hub.” Link

Ghana: “Silverbird Weija, a new 3D cinema branch of the Silverbird Cinemas serving Ghanaians with a repertoire of blockbuster movies will officially open on Friday, February 7, 2014 with the premiere of “Robocop” in 3D. Though the cinemas have been operating since the end of December 2013, the launch event will mark the official opening of the cinemas.” Link

Business

3D Film Attendance Graph

USA: Will box office in 2014 be down because of fewer 3D titles? One analyst seems to think so. “While 2013 was a record year for US box office returns, with $10.9 billion in ticket sales, analysts at Morgan Stanley argue that 2014 won’t be a repeat, mainly because of fewer 3D releases (it estimates the release of 28 compared to 34 last year) and lower attendance rates (39% compared to 42% last year) for those 3D films that are screened.” While the article points out that there will be no Pixar films in 2014, it wrongly claims that “Frozen” was a Pixar film (it was a Disney film) and the last few Pixar films since Toy Story 3 have under performed critically and commercially. More interesting will be to see if Interstellar will be a 3D match for Gravity. Link

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Daily Cinema Digest – Thursday 16 January 2014

Croatia

Croatia: The biggest trial in Croatia’s history, for a Ponzi scheme that defrauded hundreds, is taking place in a cinema. “With around 700 people taking part in the Forex trial, no courtroom in the country is bigger enough to accommodate those numbers, so it was decided to move the trial to a cinema in the capital. Nine defendants will be in the ‘box’ today, charged with financial fraud against 681 complainants, totalling around 18 million euros.” The Student Cinema costs 1,000 per day. It is not known if it also screens The Wolf of Wall Street in the evening, though it would seem appropriate. Link

Canada: A letter to Ottawa Herald claims that the city’s Plaza cinema is the country’s oldest. “is the oldest of its kind in the nation, perhaps even the world [sic]. While architecturally it does not show history as well as many of our beautiful downtown buildings, it could very well be the vehicle used to share our other treasures with the world.” Link.

Australia: “A MEASLES warning has been issued by the Health Department amid fears visitors to a Perth cinema may have been exposed to the highly-infectious disease. Anyone who visited the Garden City Hoyts Cinema Complex in Booragoon around noon on January 8 is warned to watch for symptoms of the disease between now and January 26.” Link.

UK: More on community fundraising for cinemas. “Residents are being asked to donate £10 to finish off the restoration of the former Odeon cinema in St Albans. The London Road building is set to open this summer after being transformed into a £2 million art deco masterpiece, renamed the Odyssey.” Link.

UK: Curzon’s Cinemas Renoir in the heart of Bloomsbury is set for renovation. “If Camden Council’s planning department give the go-ahead, its current two screens will be converted into six smaller theatres,” It started out as one screen and now it will be six! Link.

UK: Bolton Council have approved plans for redeveloping a shopping mall that will include a cinema. “The project designed by Wren Architecture & Design will see the creation of a nine-screen, 1,200-seat cinema within the existing centre. The 30,000 sq ft cinema will be installed in part of the 640-space three-storey car park, with partial replacement of parking spaces above.” Link.

UK: A former North London Polytechnic and one-time Pizza Express building in Kentish Town is set to be turned into an up-market arthouse cinema. “The New Journal has learned a leading cinema chain who offer upmarket film-going experiences with posh nibbles, cocktails and sofas for two are set to move in. The type of films on the bill would be a mix of trendy foreign flicks, “classics” and the latest releases.” The building has been Coronation Gardens Cinema between 1911 and 1913. Link.

Market Street Cinema

US: Legendary San francisco cinema is set to be razed and replaced by a condo building. “Historic, seedy and possibly haunted Market Street Cinema at 1077 Market Street has joined the march to oblivion, as its owners have agreed to sell to a developer who will raze the 101-year-old movie house turned strip joint turned turned ghost palace.” Link

Russia: THR reports that the future is looking uncertain for Russia’s proposed cinema museum. “engineering surveys of the building that was proposed to house the facility revealed the site is in too poor condition to preserve a collection of more than 400,000 pieces of film memorabilia and an archive of classic films.” Taking a dig at Russia’s Minister of Culture, the museum’s 76-year old founder and head says, “”The current situation around the Cinema Museum once again proves the incompetence of the people who think they run culture,”” Link.

Poland: Fresh from the announcement of the merger with Cineworld, Europe’s second-largest cinema operator has ambitions to compete with Disneyland. “Warsaw-listed movie operator Cinema City International will use the cash from merging its cinema business with UK-based cinema giant Cineworld for investments, with focus in the first place put on amusement park project, Park of Poland, CCI CFO Nisan Cohen said on January 13 2014.” Link.

Vietnam: “All Megastar cinemas have been renamed CGV as of Wednesday, January 15, announced the CJ CGV Group of South Korea, the new manager of Viet Nam’s biggest cinema chain. CGV cinemas will also be installed with 4DX, a motion picture technology that provides a four-dimensional cinematic experience.” Link.

Sri Lanka: The Media Minister is promising an ammendment to the National Film corporation Act that is credited with having revived the domestic film and cinema industrie.. “Accordingly 35 cinema halls reopened by 2005. The amendment of the National Film Corporation Act commenced as an initial step to introduce a modern cinema. The prime aim of the amendment was to make provisions for digitization.” and “Discussions are also underway with investors for the launch of the strategy for digitalization.” Link.

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Cineworld’s Me-Too Eastern Expansion Comes At A Price

Cineworld Logo

UK’s publicly listed exhibitor Cineworld is expanding into Central Europe through £503 cash and equity deal for Warsaw-listed Cinema City International (CCI), which will make it the second largest chain in Europe after Odeon UCI. The deal signals a strategic shift for Cineworld after a small domestic acquisition and and an abandoned south European deal, indicating that future growth lies in Central and Eastern Europe (CEE), as well emerging markets like Turkey and Russia, while box office declines in Western Europe.

The deal, subject to shareholder approval, will see Cineworld pay CCI £503 in cash and shares, of which £272m will be in cash, with a £110m rights issue launched to help fund the purchase, and giving CCI a 24.9 per cent stake in the merged business. CCI currently operates 99 multiplexes with 966 screens (giving it a 9.75 screen/site ration) in six countries in Central and Eastern Europe (Poland, Hungary, Czech Republic, Bulgaria, Romania and Slovakia) as well as in Israel. The combined entity will have  201 sites and 1,852 fully-digital screens (9.21 s/s ratio), indicating that the two are a good match in terms of mostly being new multiplexes. Shares rose by 10.27 and seven per cent for Cineworld and CCI respectively, meaning the markets largely welcomed the merger. The operator will be the largest or second largest in all territories where it is present. But at what price?

Cinema City Territory Map

Competition and change in strategy

Unlike its UK competitors Odeon UCI and Vue, Cineworld has previously been focused exclusively on UK and Ireland , where it operates five of the ten highest grossing sites (though both BBC and Screen claim that it operates all ten of the most profitable sites). Odeon had inherited sites in Spain, Germany and elsewhere through its merger with Odeon in 2004, following the acquisition of both by Guy Hand’s Terra Firma. Odeon UCI abandoned plans for a £1bn+ floatation, settling for a £475 re-financing plan instead two years ago. Reasons cited for this change included “problems in its Spanish markets, where results were weak in the second quarter after a 30 per cent fall in volumes, and a bumper crop of bigger blockbuster films set for release in 2015.” Vue had meanwhile bought Polands second largest cinema operator Multikino, having already established itself in Germany (through the acquisition of CinemaxX), Portugal, Denmark and Taiwan, before being bought by two of Canada’s largest pension funds last year.

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Private Equity Firm Acquires U.K.’s Vue

Vue Cinemas Logo.jpgLate last week Vue Entertainment, the United Kingdom’s third largest movie theatre chain, was sold to a private equity firm. Doughty Hanson & Co. will reportedly cough up GBP £450 million (USD $730 million) to take over the circuit. The news was picked up primarily by business and trade publications, though depending on how events play out it could actually prove to be rather significant.

Based in London, Vue began it’s life in 1998 as SBC International Cinemas. With backing from Boston Ventures, co-founder and chief executive Tim Richards had opened six theatres by 2003. That was the year SBC pulled off a huge coup by acquiring the much larger Warner Village Cinema chain for £221 million (USD $353.6 million) and rebranding the company as Vue Entertainment. With 42 venues and 384 screens Vue became the third largest exhibitor in the U.K.

Then in June of 2006, Vue announced a management buyout of the company. The Bank of Scotland helped finance the deal which was estimated at £350 million (USD $644 million). By that time Vue had grown to 544 screens across 55 cinemas. Vue’s executive team took a controlling 52 percent share of the company with Coller Capital Ltd. taking a 29 percent ownership and Och Ziff Capitam Managment Group holding a 19 percent stake.

Today Vue operates 68 cinemas accounting for 678 screens throughout the U.K. and Ireland. Over last several years the company has been responsible for about half of all the multiplexes built in the U.K. They also own one theatre in Portugal and another in Taiwan. But that number could soon grow quite rapidly. Bloomberg suggested that Vue might use some of the cash from the Doughty Hanson sale to buy the U.K.’s largest circuit, Odeon, or possibly Cineworld. Another scenario has Vue scooping up a European theatre chain outside the U.K. Of course, they could always expand by opening new cinemas.

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