June 30, 2016 / 4:30 AM / in 2 years

Carmike Cinemas adjourns AMC vote, throwing deal into doubt

(Reuters) - Theater chain Carmike Cinemas Inc CKEC.O dropped Thursday’s shareholder vote on its proposed sale to AMC Entertainment Holdings Inc (AMC.N), saying it was adjourning until next month and throwing the $1.1 billion deal into doubt.

Carmike said the adjournment was made at the request of AMC and that the special meeting will reconvene on July 15. The record date of eligible shareholders remains May 16, the company said.

The deal was opposed by some of Carmike’s biggest shareholders, including Mittleman Brothers LLC, who urged other shareholders to vote against the proposed deal.

Another big shareholder, Driehaus Capital Management LLC, said in March that AMC’s $30 per share offer meaningfully undervalued Carmike.

Dalian Wanda Group-owned AMC Entertainment agreed to buy Carmike in a deal valued at about $1.1 billion, including debt, making the combined company the largest U.S. theater chain.

In a separate statement, AMC said the company remains committed to the deal, but listed several reasons why it is now under “considerable risk.”

Among the reasons is “the considerable weakening of the industry-wide movie box office since the transaction was announced,” AMC CEO Adam Aron said in the statement.

Aron said that delaying the meeting to July 15 will allow the two sides to determine if the deal can be preserved or abandoned.

Reporting by Michael Flaherty in New York and Vishal Sridhar in Bengaluru; Editing by Gopakumar Warrier and David Gregorio

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