Cineworld Group, plc (LSE: CINE) and Cinemark Holdings, Inc. (NYSE: CNK) announced today an agreement to acquire the remaining units of National CineMedia, LLC currently owned by AMC Entertainment Holdings, Inc. (NYSE: AMC). The transaction will be financially accretive to each of Cineworld and Cinemark and represents an on-going confidence in the long-term opportunity associated with the cinema advertising business model.
The purchase price for the 21.5 million remaining units is approximately $156.8M, representing a price of $7.30 per unit. Cineworld and Cinemark will each acquire half of the units and will fund the transaction with available cash.
This transaction fulfills AMC’s requirement to sell its interest in NCM under the consent decree with the U.S. Department of Justice in connection with AMC’s acquisition of Carmike Cinemas, Inc. in December 2016.
Mooky Greidinger, Cineworld’s Chief Executive Officer, said, “We are delighted to further strengthen the successful and longstanding partnership between Cinemark, Cineworld and National CineMedia. Our increased investment in NCM also supports our strategy to reinforce our presence in the United Statesfollowing the recently completed acquisition of Regal Entertainment Group.”
Mark Zoradi, Cinemark’s Chief Executive Officer, stated, “National CineMedia remains an important component of our business model and we are thrilled to have partnered with Cineworld to solidify the strategic ownership of NCM by founding members. We greatly look forward to working even more closely with NCM’s Board of Directors and management team to further enhance and grow the cinema advertising business.”
Andy England, NCM’s Chief Executive Officer, commented, “We value the tremendous vote of confidence demonstrated by Cineworld and Cinemark’s increased investment in our company. We are pleased to deepen the collaboration with two of our founding members on our future business plans and strategies for continued financial growth. In addition, we look forward to continuing to work closely with AMC and servicing their cinema advertising needs under our Exhibitor Service Agreement, which has approximately 19 years remaining.”
Adam Aron, AMC’s Chief Executive Officer and President, remarked, “While AMC will no longer be a shareholder of National CineMedia, we do look forward to our continued close cooperation with NCM in the sale of pre-show onscreen advertising at a majority of AMC’s U.S. theatres.”
About Cineworld Group, plc:
Cineworld Group plc was founded in 1995 and listed its shares on the London Stock Exchange in May 2007. The company has grown through expansion and by acquisition to become the second largest cinema chain worldwide, holding the number one or number two position by number of screens in each of its regions. Cineworld currently operates 9,548 screens across 793 sites in the US, UK, Ireland, Poland, the Czech Republic, Slovakia, Hungary, Bulgaria, Romania and Israel as of 13 May 2018.
Certain statements in this announcement are forward looking and so involve risk and uncertainty because they relate to events, and depend upon circumstances that will occur in the future and therefore results and developments can differ materially from those anticipated. The forward-looking statements reflect knowledge and information available at the date of preparation of this announcement and Cineworld Group plcundertakes no obligation to update these forward-looking statements. Nothing in this announcement should be construed as a profit forecast.
About Cinemark Holdings, Inc.:
Cinemark is a leading domestic and international motion picture exhibitor, operating 533 theatres with 5,964 screens in 41 U.S. states, Brazil, Argentina, and 13 other Latin American countries as of March 31, 2018. For more information, go to investors.cinemark.com.
Certain matters within this press release include “forward–looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Forward-looking statements may involve known and unknown risks, uncertainties and other factors that may cause the actual results or performance to differ from those projected in the forward-looking statements. For a description of these factors, please review the “Risk Factors” section or other sections in the Cinemark’s Annual Report on Form 10-K filed February 23, 2018 and quarterly reports on Form 10-Q, filed with the Securities and Exchange Commission. All forward-looking statements are expressly qualified in their entirety by such risk factors.
About National CineMedia, Inc.
National CineMedia (NCM) is America’s Movie Network. As the #1 Millennial weekend network in the U.S., NCM is the connector between brands and movie audiences. According to Nielsen, more than 700 million moviegoers annually attend theaters that are currently under contract to present NCM’s Noovie pre-show in 54 leading national and regional theater circuits including AMC Entertainment Inc. (NYSE:AMC), Cinemark Holdings, Inc. (NYSE:CNK) and Regal Entertainment Group. NCM’s cinema advertising network offers broad reach and unparalleled audience engagement with over 20,800 screens in over 1,650 theaters in 187 Designated Market Areas® (all of the top 50). NCM Digital goes beyond the big screen, extending in-theater campaigns into online and mobile marketing programs to reach entertainment audiences. National CineMedia, Inc. (NASDAQ: NCMI) owns a 48.8% interest in, and is the managing member of, National CineMedia, LLC. For more information, visit www.ncm.com.
Certain matters within this press release include “forward–looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Forward-looking statements may involve known and unknown risks, uncertainties and other factors that may cause the actual results or performance to differ from those projected in the forward-looking statements. For a description of these factors, please review the “Risk Factors” section or other sections in National CineMedia’s Annual Report on Form 10-K filed December 28, 2017 and quarterly reports on Form 10-Q, filed with the Securities and Exchange Commission. All forward-looking statements are expressly qualified in their entirety by such risk factors.