Multiplex owner Cineworld buys independent operator Picturehouse
LONDON Dec 6 (Reuters) - British cinema chain Cineworld has bought independent movie theatre operator Picturehouse, giving traditionally mainstream Cineworld access to an arthouse film audience.
Cineworld, which runs about 80 cinemas in the UK, is issuing new shares to help finance the cash deal, which values privately-owned Picturehouse at 47.3 million pounds ($76.1 million).
The transaction will enable Picturehouse - the trading name of City Screen Group - to open in more than 10 new locations, adding to the 21 sites it currently operates, including the trendy Ritzy in South London and the Phoenix in Oxford.
"We recognise that Picturehouse is valued by its customers and we look forward to supporting the business through the next phase of its development," Stephen Wiener, chief executive of Cineworld, said on Thursday.
Picturehouse founder and director Lyn Goleby pre-empted any concerns that the buyout could detract from the company's distinctive charm in a market dominated by identikit multiplexes.
"The unique character of Picturehouse cinemas will remain and our team will continue to bring the widest range of film to customers," Goleby said.
Picturehouse will operate as a separate entity within the Cineworld Group and continue to be run by the existing Picturehouse management team.
Cineworld, which is looking to big-name releases like 'The Hobbit' and James Bond movie 'Skyfall' to keep its box office revenues flowing over Christmas, said trading had been in line with market expectations.
It said Picturehouse expected to earn 5 million pounds in 2012 and that the buy would likely boost Cineworld earnings per share by high single digits in 2013.
The company said it intended to place up to 6.4 million shares, representing around 4.5 percent of the company, to raise 16 million pounds. The rest of the buy would be funded from debt, it said.