China-owned AMC Theatres ups bid for rival Carmike
US CINEMA chain AMC Theatres, controlled by China’s richest man Wang Jianlin, increased its bid on July 25 for rival Carmike in its effort to build the world’s largest theatre chain.
AMC Entertainment Holdings, owned by Wang’s Mr Wanda conglomerate, said it was raising its March cash-and-stock bid for Carmike Cinemas by about 10 percent to US$33.06 per share, valuing Carmike at around $1.2 billion.
The merger would create a company with more than 600 theatre locations and 8380 screens across the United States.
While AMC’s original offer had been accepted by Carmike’s board, it met with significant resistance from shareholders as too low. AMC argued that the new deal is a good one, offering a 32 percent premium on the value of Carmike shares compared with when the bid was first made.
It said that Carmike shareholders who rejected the original offer were relying on analysis of the deal that is “materially flawed”.
“We continue to believe that the proposed merger between AMC and Carmike is a compelling opportunity that offers significant value to both companies’ shareholders,” said AMC chief executive Adam Aron in a statement.
“This latest agreement between AMC and Carmike is our best and final offer for Carmike,” he added.
In a separate statement Carmike’s board said it unanimously supported the bid, but still needed the backing of shareholders. Carmike shares fell 1.2pc to $30.77 in midday trade, while AMC lost 1.6pc at $30.11.
Two weeks ago AMC announced it was buying the London-based Odeon & UCI cinema group, which has 242 cinemas and 2236 screens in Europe, in a deal worth about $1.2 billion.
Wanda, which through mainly real estate investments has propelled Mr Wang to the top of China’s rich list with a fortune put by Forbes at $30 billion, has been making a strong push into the entertainment industry, especially in Hollywood. It bought AMC in 2012 for $2.6 billion.
In January this year it signed a $3.5 billion deal to buy Hollywood studio Legendary Entertainment, the maker of blockbusters ‘Jurassic World’ and ‘Godzilla’. –