Cineworld In Advanced Talks For Potential Acquisition Of Regal Entertainment

(RTTNews) - Cineworld Group plc (CINE.L) on Wednesday confirmed that it is in advanced discussions or a potential acquisition of Regal Entertainment Group (RGC).

Responding to press speculation regarding the potential acquisition, Cineworld said it is finalising due diligence in relation to a possible all-cash offer to acquire Regal at a price of $23 per share.

Regal is the second largest cinema chain in the United States.

It is currently intended that Cineworld would fund a potential acquisition of Regal through a mixture of incremental debt and a material equity raise by way of a rights issue, including a commitment to full subscription from Cineworld's 28% shareholder, Global City Holdings N.V.

The proposed financing of the planned deal will allow the enlarged group to continue its current strategy of investment in the business, as well as to maintain its policy of progressive dividends.

Cineworld would only proceed with the potential transaction in circumstances and on terms which it believes would be accretive to shareholder value.

It is expected that the potential acquisition of Regal would provide Cineworld with a highly attractive platform in the world's largest cinema market.

Shareholders are advised that there can be no certainty that the discussions between Cineworld and Regal will lead to any agreement or as to the timing or terms of any such transaction.

If it takes place, the transaction would be classified as a reverse takeover. Completion of any transaction would be conditional on Cineworld shareholder approval.

Following the media reports, Regal shares gained 7.56 percent on Tuesday and settled at $19.63 in regular trading. In after hours trading, the shares gained further 6 percent.