COMPANY NEWS News Wire Jan 6, 2024 Cineworld’s Ex-Billionaires Seek Funds to Acquire Movie Theaters Thomas Buckley, Bloomberg News A closed Cineworld Group Plc cinema in Leeds, U.K., on Wednesday, Feb. 17, 2021. U.K. inflation accelerated in January, boosted by the cost of furniture, household goods and food. Photographer: Anthony Devlin/Bloomberg A closed Cineworld Group Plc cinema in Leeds, U.K., on Wednesday, Feb. 17, 2021. U.K. inflation accelerated in January, boosted by the cost of furniture, household goods and food. Photographer: Anthony Devlin/Bloomberg , Bloomberg
WASHINGTON: Mooky and Israel Greidinger, who built Cineworld Group into the world’s second-largest theatre chain only to see the company go bankrupt during the pandemic, are looking to get back into the movie business.
The brothers have held talks with banks and investment funds to raise capital for potential acquisitions of theatres, according to people familiar with the matter.
The talks are at an early stage, and no targets have been identified, said the people, who asked not to be identified because the discussions are private.
A spokesperson for the Greidingers declined to comment.
Current industry conditions will test the fortitude of any new investors. Theatres are still struggling to recover from the Covid-19 pandemic and will cope with a thin slate of releases from major US studios this year.
The Greidingers were replaced as executives of Cineworld last year after the pandemic and heavy borrowing forced the company to file for Chapter 11. It acquired the Regal chain in the United States in 2018 for US$5.9bil, including debt.
The family held about a 30% stake in Cineworld, indicating the chain’s descent into bankruptcy wiped out a family fortune once worth more than US$1bil. The brothers received about US$30mil as part of their exit package.
The Greidingers’ ties to the theatre industry date back to the 1930s, when an earlier generation opened their first theatre in Haifa. Mooky and Israel later joined the business, expanded into Eastern Europe and renamed the company Cinema City. It merged with Cineworld in 2014.
Because of a non-compete agreement with their former employer, the two are looking at markets where Cineworld doesn’t operate, the people said. That means they’ll have to look outside the United States, where Regal is a major player.
Canada is a market where Cineworld doesn’t operate and where the Greidingers would be unencumbered. The Greidingers previously tried to acquire Cineplex Inc, the No. 1 chain in Canada. That deal fell through after Cineworld filed for bankruptcy.
Last year, Kinepolis Group NV, one of the largest theatre operators in Europe, considered making a bid for Cineplex but chose not to proceed after concluding a deal would struggle to win regulatory approval, Bloomberg reported.
One option for Kinepolis was to find a partner to acquire some Cineplex theatres, people with knowledge of the matter said at the time.
Other theatre chains earmarked for sale in recent months in markets where Cineworld doesn’t have a presence include France’s CGR and Dalian Wanda Group’s Hoyts in Australia.
The Greidingers, who are Israeli, are also interested in the Middle East, but doing business in that region is challenging at the moment due to the Israel-Hamas conflict, the people said. — Bloomberg
