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Shares of Regal Entertainment Group surged 8 percent Tuesday after reports surfaced that the movie theater chain controlled by Philip Anschutz was in talks to merge with the Cineworld Group, which operates more than 2,000 screens in Europe.
Regal, which operates more than 7,300 screens primarily stateside, previously sought a merger partner in 2014, though one did not emerge. A combined Regal-Cineworld would be better equipped to compete with AMC Entertainment, the worldwide leader operated by the Dalian Wanda Group out of China.
Shares of Regal have risen for six days straight, ending trading on Tuesday at $19.64, up 23 percent for the week and giving it a $3.1 billion market cap.
Late Tuesday, Regal issued a statement confirming “it is currently engaged in discussions with Cineworld Group plc about a possible all-cash acquisition of Regal at a price of $23 a share.”
Movie theaters are under pressure from streamers like Netflix and a stagnant box office of late, and they are responding with upgraded auditoriums, food and drink. They’re also toying with ideas like dynamic pricing, whereby patrons would pay a premium for the most popular titles.
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