Cinema giant Vue screens buyers for post-summer blockbuster sale | Business News

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Britain’s third-biggest cinema chain is to kick off an autumn auction ‎that is likely to value it at more than £2bn and spark a frenzy of interest from industry rivals.


Sky News has learnt that Vue International, which operates just under 900 screens across the UK, will launch a formal sale process in the autumn.

Any deal, which could take several months to conclude, is likely to value the 26% stake of Vue’s management – led by chief executive and founder Tim Richards – at more than £500m.

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Vue’s founder and chief executive is Tim Richards

City sources said on Friday that ‎bankers at JP Morgan would oversee the auction, which will come in the wake of summer film releases including Toy Story 4 and The Lion King.

Vue is majority-owned by ‎two Canadian funds: the Alberta Investment Management Corporation (AIMCo) and Omers, an Ontario-based pension fund manager.

They each own 37% of the company, meaning their stakes could be worth in the region of £800m.

One insider said the performance of Vue and the successful integration of recent overseas acquisitions meant the business could in fact be worth significantly in excess of £2bn.

AIMCo examined a sale of its shareholding a year ago, but opted not to proceed.

Insiders said that all three groups of Vue investors were now aligned behind the prospect of a sale, paving the way for a change of control for one of the world’s biggest cinema operators.

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AIMCo and Omers have been shareholders in the company since 2013, when it changed hands in a deal worth just under £1bn.

A sale of Vue is understood to be the preferred option of its investors, although it is unclear whether a stock market listing has been ruled out.

The potential for a flotation appeared to be highlighted in 2017, when Adam Crozier, the former ITV, Royal Mail and Football Association chief executive, was appointed as Vue’s chairman.

Industry sources have previously tipped cinema chains in Mexico and South Korea as being among the likely bidders for Vue, but if they do enter the fray, they are expected to face stiff competition from financial investors.

The latest sale process will come during a period of considerable change for the cinema industry, which is facing varying degrees of competition from on-demand streaming services such as Netflix.

Vue’s growth has been fuelled by a string of acquisitions, including Cinema3D in Poland, which completed in May.

Last year, it bought CineStar in Germany for a potential total sum of €222m.

Among Vue’s other big strategic moves under its current owners was the signing of a deal with Saudi Arabia’s Al Hokair Holding Group to open up to 30 multiplexes in the country by 2021.

Mr Richards described the alliance as “a huge moment in the history of global cinema development”.

However, the murder of the Saudi journalist Jamal Khashoggi last year prompted Vue – and other international operators – to put their plans on hold.

Last month, Vue completed an £813m debt refinancing in a move that paved the way for an auction by extending the maturity and reducing the overall cost of its borrowings.‎

It was forced to pull the refinancing last December because of “unattractive market conditions”.

The company has profited from the travails of rivals such as AMC, the US-based group which owns Odeon in the UK.

AMC had lined up banks to explore a partial flotation of Odeon but is said to have retreated from that idea.

Vue is the UK’s third-biggest cinema operator by number of screens, trailing just behind Cineworld and Odeon.

A Vue spokeswoman declined to comment on Friday.‎


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