The Dalian Wanda Group (Wanda), one of China's largest theatre owners, has agreed to buy out U.S.-based AMC Entertainment in a transaction valued at $2.6 billion. The deal is expected to create the world's biggest cinema operator.
Reuters reported on May 20 that off-and-on discussions between the companies began more than a year back and took a serious turn after AMC, the world's largest operator of IMAX screens, cancelled its plans to go public.
"This acquisition will help make Wanda a truly global cinema owner, with theatres and technology that enhance the movie-going experience for audiences in the world's two largest movie markets," Wang Jianlin, chairman and president of Wanda, said in a May 21 dated press release.
Wanda will invest up to an additional $500 million in AMC, the company said, and also that it has reached an agreement for AMC's management team to stay on after the deal closes.
The transaction is not expected to affect employee levels at AMC, said the companies.
Wanda operates 86 theatres with 730 screens in addition to being involved with large-scale live stage shows, film production and distribution, and entertainment chains.
AMC has been owned since 2004 by an investment group that includes the Apollo Investment Fund, J. P. Morgan Partners, Bain Capital Investors, and the Carlyle Group among others.
Ernst & Young provided financial advice to Wanda, while Citigroup acted as AMC’s financial adviser.
Advising AMC was a Weil, Gotshal & Manges team led by Shanghai-based partner Anthony Wang andNew York-based partner Douglas Ryder. Meanwhile, a Davis Polk & Wardwell team led by Beijing-based partner Howard Zhang and New York-based partner Philip Mills represented Wanda. ALB
Candice Mak is North Asia Editor at ALB. Follow her on Twitter: @ALB_Magazine.
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