National Amusements theaters on sale soon: sources

NEW YORK (Reuters) - Sumner Redstone's National Amusements is close to putting several hundred movie theaters up for sale, people familiar with the matter said, in an auction likely to help it pay about half its looming debt obligations.

An official sales prospectus on the theater chain is expected to go out any day now and bankers are reaching out to potential buyers to get them to sign confidentiality agreements, the sources said.

All U.S. theaters except those in the New England region are expected to go on sale, along with theaters in Latin America and possibly those in the United Kingdom. The theaters in Russia will be excluded from the sale, the sources said.

National Amusements operates more than 1,500 movie screens in these countries. The New England region and Russia account for roughly 300 screens.

Citigroup Inc (C.N) will handle the sale, the people said. Citigroup and National Amusements declined comment.

Analysts have valued the entire movie theater chain at about $500 million to $700 million. But for a company seeking to refinance $800 million in bank loans due in December, potential buyers will likely low-ball their offers, considering the process a fire sale.

Movie theater assets typically sell at multiples of five to six times cash flow, but investment bankers expect the National Amusements theaters to sell at three to four times.

By those measures, the chain could go for anywhere between $240 million and $480 million.

(Additional reporting by Gina Keating in Los Angeles and Paul Thomasch in New York; Editing by Bernard Orr and Andre Grenon)