Gaumont to Sell Theater Chain Stake to Pathe for $400 Million
The deal for the 34 percent stake will help finance the launch of its feature film production arm.
Increasing its focus on the production business, Gaumont said Wednesday it will sell its 34 percent stake in the Gaumont-Pathe cinema chain to partner Pathe in a 80 million euro ($400.5 million) deal.
“The completion of this disposal will provide us with the resources to accelerate the promising development of our television production activities in the USA and in Europe, reinforce our cinema production and consider expanding Gaumont`s activities in Europe,” said Gaumont CEO Sidonie Dumas.
The deal comes on the heels of Gaumont’s launch of an L.A.-based English-language feature film production arm Feb. 1. The film studio’s slate includes a long-gestating Barbarella project and a remake of the South Korean hit Train to Busan.
Meanwhile, the company's TV production arm established in 2012 is behind NBC’s Hannibal and Netflix’s Narcos.
The cinema chain, with 1,076 screens in France, the Netherlands, Belgium and Switzerland, was created in 2001 by the merger of the exhibition businesses of Gaumont and Pathe.
"We are pleased by the successful co-operation with Pathe over the last 16 years, which established Les Cinemas Gaumont Pathe as a leading European movie theater operator,” said Dumas.
"This acquisition clearly states Pathe's intention to develop and modernize movie theaters. The movie theater is essential to the motion picture, and the motion picture is essential to the movie theater,” said Pathe chair Jerome Seydoux.
Pathe’s executive board has approved the deal, which is contingent on final approval from Gaumont’s board and the finalization of Pathe’s financing deal.
If the sale goes ahead, the payment will be staggered, with half of the price paid at the deal close and the balance in three installments in 2018, 2019 and 2020.