Kinepolis Acquires Emagine Entertainment
Kinepolis (Euronext: KIN), a major player in the cinema industry, has made a strategic move by signing an agreement to acquire the operations of US movie theatre chain Emagine Entertainment. This acquisition aligns with Kinepolis' plans to enhance its footprint in the United States and is expected to be finalized by the end of the year.
Expanding the Cinema Portfolio
This acquisition is significant as it will add 14 new cinemas to Kinepolis' extensive portfolio, amounting to a total of 177 screens and providing approximately 18,000 seats. Located across key states such as Michigan, Illinois, Indiana, and Wisconsin, these cinemas are anticipated to attract a considerable audience, with Emagine Entertainment currently hosting around 6 million visitors annually and generating nearly USD 129 million in revenue.
Next-Level Movie Experience
The cinemas included in this acquisition are equipped with state-of-the-art recliner seating and house Kinepolis' premium large format screens known as EMX and Super EMX. EMX features impressive wall-to-wall screens utilizing 4K laser projection complemented by Dolby Atmos sound systems, offering an exceptional viewing experience. The Super EMX takes it a step further with even larger screens and a superior audio setup, creating an immersive environment for cinema-goers.
Expanding Support and Services
In addition to its features, Emagine Entertainment also provides essential support services to a chain of cinemas spanned across Minnesota and Colorado, along with its established venues in Michigan - Emagine Woodhaven and The Riviera. These locations operate under the Emagine brand and are handled by third parties through a brand licensing agreement, ensuring continued operation and quality standards.
Leadership Perspectives on the Acquisition
Eddy Duquenne, CEO of Kinepolis Group, expressed his enthusiasm about this acquisition, marking it as a crucial milestone in the company’s expansion strategy, especially as this is the first acquisition of such scale since the challenging times posed by the pandemic. He highlighted the impressive quality of the cinemas involved and emphasized the strategic value they add to Kinepolis' portfolio, especially in a market where the company has already established positive experiences with its cinema concepts.
Commitment to Emagine's Legacy
Paul Glantz, Chairman and CEO of Emagine Entertainment, also shared his views, praising Kinepolis for its reputation for managing well-operated cinemas both in Europe and North America. He believes that Kinepolis' dedication to providing exceptional guest experiences makes them the perfect holder to maintain the legacy of Emagine into the future.
Understanding the Financial Aspects of the Deal
The transaction reflects a value of USD 105 million for the total acquisition of Emagine's business, with an additional earn-out potential of up to USD 15 million based on the growth of the US Box Office in the upcoming year. The financial analysis estimates that Emagine Entertainment is poised to contribute an EBITDAL of USD 19.6 million, showcasing its profitability and growth potential.
Financing the Acquisition
Kinepolis plans to finance this acquisition using an incremental facility of EUR 100 million, which falls under their existing credit facility. This robust financial strategy positions Kinepolis to not only expand its operations but also invest in enhancements for the acquired theatres to meet the desired customer experiences.
Future Operations and Customer Commitment
Moving forward, Kinepolis intends to maintain the operation of Emagine theatres under their established brand name, ensuring continuity for the existing customer base. The company is also committed to considering the needs and welfare of all Emagine employees and stakeholders during this transition.
About Kinepolis
Kinepolis Group NV emerged in 1997 from a merger of two family-run cinema groups and has been listed on the stock exchange since 1998. It operates an innovative cinema model that continues to set industry standards. Beyond cinema operations, Kinepolis is involved in various sectors including film distribution, event organization, screen publicity, and property management.
Kinepolis' Global Presence
As it stands, Kinepolis Group operates a total of 108 cinemas globally, which encompasses 63 cinemas across Europe, including countries like Belgium, the Netherlands, France, Spain, Luxembourg, Switzerland, and Poland. The company has also expanded into North America, managing 35 cinemas in Canada and 10 in the United States following its acquisition of Landmark Cinemas and MJR Theatres.
Looking Ahead
The commitment from Kinepolis' dedicated team is evident—they strive to provide millions of visitors with an unforgettable movie experience. The recent acquisition of Emagine Entertainment signifies not only a remarkable step in Kinepolis’ growth but also underscores its aim to enhance the cinema experience for audiences in the regions it serves.
Frequently Asked Questions
What is the significance of Kinepolis acquiring Emagine Entertainment?
This acquisition allows Kinepolis to expand its presence in the US cinema market, adding 14 new cinemas to its portfolio.
How will this acquisition affect existing customers of Emagine Entertainment?
Kinepolis plans to maintain Emagine’s brand name and prioritize the continuity of operations for current customers.
What is Kinepolis' strategy for financial management after the acquisition?
Kinepolis will finance the acquisition through an incremental facility under its existing credit facility, ensuring strong financial backing.
What kind of movie experience can customers expect from Emagine theatres?
Customers can look forward to premium offerings such as recliner seating and high-quality sound and projection technology.
How many cinemas does Kinepolis operate worldwide?
Kinepolis operates a total of 108 cinemas globally, serving a large number of audiences each year.
