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Regal Entertainment Group, a motion picture exhibitor owning and operating one of the largest (7,315 screens in 561 theatres in 43 states along with Guam, Saipan, American Samoa and the District of Columbia) theatre circuits in the United States, "today confirmed that it is currently engaged in discussions with Cineworld Group plc about a possible all-cash acquisition of Regal at a price of $23.00 per share. No agreement has been reached, and there is no assurance that any transaction will result. Regal Entertainment Group does not intend to make any further comment, or respond to any inquiries, until an agreement, if any, is reached, or discussions have been terminated".
The $23.00 price equals the 12 months high attained a year ago, Regal's share price having dropped to the current 19 USD level since February. Where UK based Cineworld's shareprice has seens a slight increase this year. Prior to the negotiations becoming public, Regal with almost three times the screens of Cineworld's 2,049 screens across 221 sites in the British Isles, Eastern Europe and Irael, was valued only slightly higher $2.8 Billion verses Cineworld's $2.5 Billion. Following Reuters breaking the news Regal shares jumped 17 percent before trading was halted. The bid values Regal at $3.6 Billion.
Cineworld and Regal could “sense an opportunity to assume the role of theater consolidator now that AMC is on the sidelines with an over-leveraged balance sheet”, Bloomberg Intelligence analyst Paul Sweeney told Bloomberg. AMC is reportedly lookig to list or sell its European assets seeking around $4.5 Billion, to reduce its outstanding debt.
The Euro-US combination could rival AMC in scale. CJ CGV of Korea and Cinepolis from Mexico are said to be the most likely candidates to launch a rival to Cineworld's $23 per share/$3.6 Billion offer.
Update: Cineworld's share price dropped a massive 17% on the London Stock Exchange Wednesday morning after Europe's second largest cinema chain confirmed it was in talks to buy US cinema operator Regal Entertainment for $3.6 billion.
The $23.00 price equals the 12 months high attained a year ago, Regal's share price having dropped to the current 19 USD level since February. Where UK based Cineworld's shareprice has seens a slight increase this year. Prior to the negotiations becoming public, Regal with almost three times the screens of Cineworld's 2,049 screens across 221 sites in the British Isles, Eastern Europe and Irael, was valued only slightly higher $2.8 Billion verses Cineworld's $2.5 Billion. Following Reuters breaking the news Regal shares jumped 17 percent before trading was halted. The bid values Regal at $3.6 Billion.
Cineworld and Regal could “sense an opportunity to assume the role of theater consolidator now that AMC is on the sidelines with an over-leveraged balance sheet”, Bloomberg Intelligence analyst Paul Sweeney told Bloomberg. AMC is reportedly lookig to list or sell its European assets seeking around $4.5 Billion, to reduce its outstanding debt.
The Euro-US combination could rival AMC in scale. CJ CGV of Korea and Cinepolis from Mexico are said to be the most likely candidates to launch a rival to Cineworld's $23 per share/$3.6 Billion offer.
Update: Cineworld's share price dropped a massive 17% on the London Stock Exchange Wednesday morning after Europe's second largest cinema chain confirmed it was in talks to buy US cinema operator Regal Entertainment for $3.6 billion.
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