Colossus theatre in Langley. (Langley Advance Times Files)

Colossus theatre in Langley. (Langley Advance Times Files)

U.K. company to buy Cineplex, Canada’s largest theatre chain, for $2.8B

Cineworld says it’s the second-largest cinema business in the world, by number of screens

Cineplex Inc. shares jumped to their highest level in a year on news it has agreed to be purchased by a U.K. company in a friendly deal that values Canada’s largest chain of movie theatres at $2.8 billion, including debt.

Cineworld Group PLC has agreed to pay $34 per share in cash, a 42-per-cent premium to Friday’s closing price for Cineplex. Cineplex shares rose to that level in early trading after the Toronto Stock Exchange opened.

“Given CGX’s significant market share in Canada and historical premium to U.S. peers, we believe the elevated valuation was largely warranted and expect that CGX shareholders are likely to approve of such a transaction,” analyst Aravinda Galappatthige wrote in a research note for Canaccord Genuity.

If the deal is approved by shareholders and regulators, Cineplex will become part of a multinational company listed on the London Stock Exchange.

Cineworld says it’s the second-largest cinema business in the world, by number of screens, with operations in the United Kingdom, Ireland, Poland, the Czech Republic, Slovakia, Hungary, Bulgaria, Romania, Israel and the U.S.

“We believe this transaction today is both financially compelling and in our shareholders best interest,” said Ellis Jacob, Cineplex president and CEO, said in a statement.

“The entertainment industry continues to transform and we are pleased that through this agreement we are ensuring Cineplex is part of the next era of global entertainment.”

The companies expect the transaction to close in the first half of 2020.

READ MORE: Led by ‘Marriage Story,’ Netflix dominates Golden Globe noms

However, Cineplex has seven weeks to solicit and negotiate with other potential buyers who may be willing to pay more for the company.

Cineworld would receive a termination fee under certain circumstances, including Cineplex finding another buyer with a superior offer.

Cineplex has diversified in recent years into a variety of entertainment-related businesses including advertising, events programming and the Rec Room — a chain of locations serving food, drink and amusements.

David Paddon, The Canadian Press

Like us on Facebook and follow us on Twitter

Get local stories you won't find anywhere else right to your inbox.
Sign up here

Just Posted

Interior Health reported 91 new COVID-19 cases in the region Jan. 20, 2021 and three additional deaths. (Jennifer Smith - Morning Star)
95 new COVID-19 cases in Interior Health, two deaths

Another member of Vernon’s Noric House has passed

A specialized RCMP team is investigating a suspicious trailer, which might have connections to the illicit drug trade, found abandoned outside a Cache Creek motel. (Photo credit: <em>Journal</em> files)
RCMP investigating suspicious trailer found abandoned in Cache Creek

Hazardous materials believed to be consistent with the production of illicit drugs were found

Grade 5 student Liam Ouellette and Grade 4 student Trigg Jansen read together in Horse Lake Elementary School’s reading room. (Patrick Davies photo - 100 Mile Free Press)
Reading, literacy opens doors to learning

Students at Horse Lake Elementary School seek out challenging reads.

100 Mile Mayor Mitch Campsall. (Kelly Sinoski photo, 100 Mile Free Press).
100 Mile Mayor Mitch Campsall. (Kelly Sinoski photo, 100 Mile Free Press).
100 Mile mayor calls on residents to ‘work together’ during pandemic

Mitch Campsall also urges residents to follow the health orders.

Interior Health has declared the Cariboo Chilcotin a community cluster. (Angie Mindus photo)
Interior Health declares Cariboo Chilcotin region a COVID-19 cluster, 215 cases since Jan. 1

Most cases are related to transmission at social events and gatherings in Williams Lake

Businesses continue to struggle under COVID-19 restrictions as the pandemic reaches the one-year mark. (B.C. government)
Another 564 COVID-19 cases, mass vaccine plan coming Friday

15 more deaths, community cluster declared in Williams Lake

Premier John Horgan leaves the podium following his first press conference of the year as he comments on various questions from the media in the Press Gallery at B.C. Legislature in Victoria, B.C., on Monday, January 13, 2020. THE CANADIAN PRESS/Chad Hipolito
Interprovincial travel restrictions a no-go, Horgan says after reviewing legal options

The B.C. NDP government sought legal advice as concerns of travel continue

Gem Lake Top, at Big White Ski Resort, seen at Jan. 8. (Big White Ski Resort)
Big White cancels $7.3M in lift tickets, accommodations due to COVID-19 orders

Since November, the ski resort has been forced to make several changes

Darlene Curylo scratched a $3M ticket, BCLC’s largest ever scratch and win prize. (BCLC)
Kelowna woman in shock after winning BCLC’s largest-ever instant-ticket prize

Darlene Curylo couldn’t believe her eyes when she saw the amount of money she’d won from a scratch ticket

Cannabis bought in British Columbia (Ashley Wadhwani/Black Press Media)
Is it time to start thinking about greener ways to package cannabis?

Packaging suppliers are still figuring eco-friendly and affordable packaging options that fit the mandates of Cannabis Regulations

While each person has different reasons for becoming homeless, a UBCO study shows they learn through their interactions with different services to perform ‘as homeless’ based on the expectations of service providers. (Contributed)
Kelowna homeless forced to ‘perform’ for resources, says UBCO study

One participant in the study said ‘It is about looking homeless, but not too homeless’

Gov. Gen. Julie Payette takes the royal salute from the Guard of Honour as she makes her way deliver the the throne speech, Wednesday, September 23, 2020 in Ottawa. THE CANADIAN PRESS/Fred Chartrand
Gov. Gen. Julie Payette resigns, apologizes for ‘tensions’ at Rideau Hall

Payette, who is the Queen’s representative in Canada, has been the governor general since 2017

Grounded WestJet Boeing 737 Max aircraft are shown at the airline’s facilities in Calgary, Alta., Tuesday, May 7, 2019. WestJet will operate the first commercial Boeing 737 Max flight in Canada today since the aircraft was grounded in 2019 following two deadly crashes. THE CANADIAN PRESS/Jeff McIntosh
Passengers unfazed as WestJet returns Boeing 737 Max to service on Vancouver flight

After a lengthy review process, Transport Canada cleared the plane to return to Canadian airspace

The top part of the fossil burrow, seen from the side, with feathery lines from the disturbance of the soil – thought to be caused by the worm pulling prey into the burrow. (Paleoenvironntal Sediment Laboratory/National Taiwan University)
PHOTOS: SFU researchers find evidence of ‘giant’ predatory worms on ocean floor

Fossils found the prove the existence of an ancient Taiwanese worm as long as two metres

Most Read