AMC And Carmike Combine To Make Biggest Movie Theater Chain

Posted: Mar 3 2016, 7:04pm CST | by , in News | Latest Business News

 

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AMC and Carmike Combine To Make Biggest Movie Theater Chain
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The companies will beat out Regal Theaters for the top spot.

AMC Entertainment and Carmike Cinemas are about to combine and create the largest chain of movie theaters in North America. AMC is going to buy Carmike for $30 a share, for a total of $1.1 billion, including the assumption of Carmike's debt.

"This is a compelling transaction that brings together two great companies with complementary strengths to create substantial value for our guests and shareholders," said Adam Aron, who was named Chief Executive of AMC Entertainment in December.

In just hours of the announcement, both publicly traded companies saw their stocks soar.

AMC is currently the second largest theater operation in the United States, behind Regal. Carmike is the fourth largest. If Carmike's 274 locations join with AMC's, they will reach 653 theaters. Regal operates 572, according to the LA Times.

In 2012, AMC was acquired by the Chinese real estate and media group Dalian Wanda Group for $2.6 billion, which created the world's largest cinema company. Wanda also owns the largest chain in China, where movies are still a huge event for families and teens.

This acquisition goes in line with Wang Jianlin's, the Wanda Chairman, hope to increase his position for global entertainment. The company just recently purchased Legendary Entertainment, a Burbank production company, for $3.5 billion. They are also looking to purchase Paramount Pictures or another large U.S. studio.

The state of U.S. theaters has been going down as fewer people are going to see movies and purchase concessions. Still, 2015 was a good year financially, but a lot of that has to do with the fact that the average movie ticket price hit $8.43 because of an increase of Imax and 3D screenings.

AMC's fourth quarter profit that soared 40% to $41.6 million, thanks in part to the Disney-Lucasfilm blockbuster "Star Wars: The Force Awakens." Revenue jumped 10% to $783.9 million.

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<a href="/latest_stories/all/all/46" rel="author">Noel Diem</a>
Noel passion is to write about geek culture.

 

 

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