Carmike Buys Sundance Cinemas for $36 Million
With the purchase, Carmike will operate 274 theaters in 41 states.
Carmike Cinemas is buying the Sundance Cinemas, consisting of five theaters across the country, for $36 million.
Plano, Texas-based Carmike, the third-largest theater chain in the United States, announced that it has closed a cash deal for the special theater chain owned by Robert Redford's Sundance Group. The first Sundance Cinemas opened in Madison, Wis. in 2007 and has since grown to include the Sundance Sunset in West Hollywood, the Sundance Kabuki in San Francisco, the Sundance Cinemas in Houston and the Sundance Cinemas in Seattle. The chain was put up for sale in June.
With the addition of the Sundance Cinemas' 37 screens, Carmike will operate 274 theaters with 2,909 screens in 41 states. The transaction is expected to add incremental revenue of $24 million and pro-forma EBITDA of $5.6 million to Carmike's financials for the 12-month period that ended June 30, 2015, Carmike said.
The deal does not provide for Carmike to expand the Sundance brand, but Carmike will have the ability, under a license arrangement, to operate the five theaters under the Sundance brand name.
"Sundance has been enormously successful in creating a compelling consumer experience and shares our mission and vision of offering a world-class movie-going experience, including an impressive premium dining offering," said David Passman, Carmike president and CEO, in a statement. He added, "We expect that this acquisition will allow Carmike to capture proportionally higher attendance rates for non-blockbuster titles and provide additional luxury expansion opportunities and meaningful cost synergies as we increase scale to optimize film exhibition and other support costs."
Paul Richardson, Sundance Cinemas CEO, commented, "We are excited to join Carmike, which brings together two exceptional organizations with a common culture of innovation and customer focus. Sundance has worked hard to deliver the highest levels of innovation and customer service across our theaters, and we look forward to working together to increase Carmike's leadership position in cinema dining and overall movie-going experience."