STOCKHOLM Private equity firm Ratos (RATOb.ST) and publisher Bonnier said on Monday they had agreed to merge their cinema chains Finnkino and SF Bio to create the largest player in the field in the Nordic region.
Ratos would own a 60 percent stake in the combined cinema group, which would have an enterprise value of about 3.0 billion Swedish crowns ($468.85 million), while Bonnier would hold the remaining 40 percent, the companies said in a joint statement.
"We're building the region's biggest cinema group where strong local brands combine to be even more competitive," Ratos Chief Executive Susanna Cambell said in the statement.
The deal would include no capital from Bonnier, nor initially from Ratos, the companies said. The combined cinema company would have sales of about 2.6 billion crowns with an operating profit of about 360 million.
Ratos and Bonnier said they would support the new cinema group's growth in existing as well as new markets.
Bonnier-owned SF Bio is Sweden's biggest cinema chain and also operates movie theatres in Norway - in total 43 cinemas with 38,000 seats. Finnkino, owned by Ratos, is Finland's top player with 24 cinemas and 27,000 seats and also distributes films and DVDs.
The two cinema chains would continue to operate under their own brand names and would have operations in Sweden, Finland and Norway as well as in the Baltic countries Estonia, Latvia and Lithuania, Ratos and Bonnier said.
The deal depends on approval by competition authorities and is expected to be completed at the end of April 2013. ($1 = 6.3986 Swedish crowns)
(Reporting by Niklas Pollard; Editing by Helen Massy-Beresford)