February 25, 2015 / 7:16 PM / 4 years ago

Exclusive: Terra Firma to launch sale of cinema chain Odeon & UCI

BERLIN (Reuters) - Private equity group Terra Firma is planning to launch the sale of its European cinema chain Odeon & UCI Group toward the end of the year in a potential 1 billion pound ($1.55 billion) deal, its chairman told Reuters.

“We will look to begin the process to sell Odeon towards the end of the year,” Guy Hands said on Wednesday.

“We are likely to appoint banks by May. Possible buyers could include U.S. cinema groups or South American cinema firms‎, and private equity groups from Europe, the U.S., and China,” he said, adding that a stock market listing is also an option although the asset may lack scale for such a deal.

Terra Firma put Odeon & UCI, Britain’s market-leading cinema operator on the block in 2013, but did not proceed with a sale. At the time, the buyout group worked with JPMorgan and Goldman Sachs, which advised it to wait for the business to improve.

Terra Firma could shop the asset to U.S. firms such as Regal Entertainment and Cinemark or Brazil’s Grupo Severiano Ribeiro, which operates under the Kinoplex brand.

Odeon & UCI may catch the eye of its UK peer Vue Entertainment, which is owned by Canadian investors OMERS Private Equity and Alberta Investment Management Corporation.

And it may also appeal to China’s Dalian Wanda, which earlier this month bought Swiss sports marketing company Infront Sports & Media AG, as the property firm is moving into entertainment and has reportedly shown interest in Odeon in the past..

Odeon was founded in 1930. It was bought by Terra Firma for 650 million euros in 2004, which merged the company with UCI, bought in the same year for 350 million euros.

Terra Firma refinanced Odeon & UCI in 2011.

Odeon & UCI operates 2,182 cinema screens in 237 locations in the UK, Ireland, Italy, Germany, Austria, as well as in Spain where it operates under the Cinesa brand.

Reporting by Arno Schuetze and Freya Berry, editing by David Evans

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