Slaughter and May – Cineworld on its US$2.1 billion acquisition of Cineplex Inc

16 Dec 2019

Slaughter and May, working as an integrated team with McCarthy Tétrault LLP and Skadden, Arps, Slate, Meagher & Flom LLP, is advising Cineworld Group plc on its all-cash acquisition of the entire issued and to be issued share capital of Cineplex Inc. at a price of C$34 per share, valuing the fully diluted equity of Cineplex at C$2.18 billion (US$1.65 billion), with an implied enterprise value of C$2.8 billion (US$2.1 billion).

The acquisition of Cineplex, Canada’s largest cinema operator by box office revenue and number of screens, will provide Cineworld with the leadership position in the Canadian market. Following completion, the enlarged group will have 11,204 screens globally and a combined 8,906 screens across the United States and Canada, making it the leading operator in North America.

The acquisition, related expenses and the refinancing of existing Cineplex debt will be funded by approximately US$2.3 billion of committed debt facilities.

Due to its size, the acquisition is a Class 1 transaction for Cineworld under the Listing Rules, and shareholder approval is therefore a condition to completion. It is proposed that Cineworld will send a circular to its shareholders in January 2020 convening a general meeting to approve the acquisition, with completion expected to occur by the end of June 2020.

Cineworld is one of the world’s leading cinema groups, operating 9,498 screens across 786 sites in the US, UK, Ireland, Poland, the Czech Republic, Slovakia, Hungary, Bulgaria, Romania and Israel.

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Corporate: David Johnson (partner), Chris Connolly (associate), Ed Horner (associate), Tristan Crump (trainee), Jack Hull (trainee); Financing: Guy O’Keefe (partner), Claire Cooke (associate), Kieran Turton (associate), Maria Bergamasco (trainee); Tax: Gareth Miles (partner), Jamshed Bilimoria (associate), Nicola Dinan (associate)

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