Cineplex Will No Longer Be Canadian After Being Sold To UK Mega Chain Company
They will be sold for $2.8 billion.
Canada's cinema world just got a major overhaul. The Toronto-based movie giant Cineplex Entertainment Inc. was recently sold to a U.K.-based company called Cineworld in a "friendly takeover deal". Cineplex sold for $2.8 billion, and Cineworld will take on their debt in the newly acquired deal, stripping the company of its pure Canadian status.
The transaction hasn't completely closed just yet. It still needs to be approved by shareholders and regulators, according to CTV News.
It is expected to be a done deal by the first half of 2020, but Cineplex reportedly still has seven weeks to possibly negotiate with another buyer that may be willing to pay more to acquire them.
"We believe this transaction today is both financially compelling and in our shareholders' best interest," Cineplex chief executive Ellis Jacob said in a statement to the Canadian Press.
Cineworld currently has operations in 10 countries, namely the United Kingdom, Ireland, Poland, the Czech Republic, Slovakia, Hungary, Bulgaria, Romania, Israel and the U.S.
When Canada joins that list, it will solidify Cineworld's status as one of the largest cinema businesses in the world and the largest in North America.
They would be taking over the 165 Cineplex theatres which operate across Canada.
Meanwhile, Cineplex has tweeted that this will not affect peoples'and that they will maintain the rewards program.
According to the Financial Post, movie theatres have been joining forces to cut costs and remain relevant in the age of and online streaming.
Bigger chains have a better position at the bargaining table with studios such as Walt Disney Co., for example.
has had huge success streaming online, and could also be transferred to movie theatres more easily with the monopoly.
“The deal is being done first of all to improve the experience of the public and having more customers and second to get efficiencies in other costs,” Mooky Greidinger, CEO of Cineworld, told the Financial Post.
The reactions on Twitter have been pouring in, and people are expressing their thoughts on how the brand will no longer be Canadian.
"Wow. With the sale of Cineplex, the Canadian theatrical monopoly will no longer be Canadian," wrote one user.
"Very interesting that Cineplex has grown in value in the light of the digital movie battle..." wrote another user.
Despite the near end of Canadian cinema history, there have been no announcements or plans of any movie theatre closures throughout the nation.