U.K. Exhibitor Cineworld Acquires Picturehouse Cinemas
The second-largest British exhibitor takes over the art house cinema chain for $76 million in cash.
LONDON – Cineworld, the U.K.'s second largest exhibition chain, has paid $76 million (£47.3 million) to buy City Screen Group, the parent company of arthouse movie theater operator Picturehouse Cinemas.
The deal, struck between Cineworld and City Screen majority owner Arts Alliance, adds 21 sites and 60 screens to its real estate and also Picturehouse Entertainment, the distribution arm operated by the group.
Cineworld, listed here on the stock exchange, told the market it also gives the exhibitor the promise of 10 new locations across the U.K. "already in the pipeline."
Picturehouse will operate as a separate business entity within the Cineworld Group, the parties said and will continue to be run by the existing Picturehouse management team.
Arts Alliance has been the majority shareholder of Picturehouse since 2002.
For the year ended Dec. 31 2011, Picturehouse reported audited sales of $48.8 million (£30.3 million), profit before tax of $4 million (£2.5 million) and gross assets of $56 million (£35 million).
Prior to Cineworld's acquisition, Picturehouse’s primary shareholders were Arts Alliance, Lyn Goleby and Albion Venture Capital Trust.
Cineworld CEO Stephen Wiener said: "This acquisition gives us an opportunity to accelerate our growth by reaching new audiences in a high value and growing part of the market. We recognize that Picturehouse is valued by its customers and we look forward to supporting the business through the next phase of its development."
Picturehouse was the first major cinema group in the U.K. to convert 100 percent of its screens to digital cinema projection.
Arts Alliance Media wiil continue to provide digital in-cinema solutions, services and support to Cineworld and to Picturehouse cinemas.
Before the deal was struck Cineworld operated 80 sites, of which 77 are multiplex sites with five screens or more.