AMC Cinema to be bought by China's Wanda
- 21 May 2012
- From the section Business
Chinese conglomerate Wanda Group has agreed to buy US cinema chain AMC Entertainment for $2.6bn (£1.6bn), making it the world's biggest operator of movie theatres.
The deal gives Wanda access to more than 5,000 screens operated by AMC, mainly in the US and Canada.
Wanda said it would invest another $500m in the US theatre chain.
There have been several deals between US and Chinese film companies in recent months.
China's theatre market is one of the fastest growing and the deal brings Wanda together with the second largest theatre chain in the US.
Wanda group is based in Beijing and is controlled by real estate developer and billionaire Wang Jianlin.
The deal follows a pattern set by a number of other Chinese firms, which have used offshore acquisitions to help their expansion plans - buying up foreign brands and their staff.
At a signing ceremony for the deal, Mr Wang, who is also chairman of Wanda, said he supported AMC becoming bigger, not only in the US but globally.
AMC has been facing growing losses as growth in the US has slowed. The company reported a net loss of $73m in the fourth quarter of 2011.
Mr Wang said AMC's financial problems were due to the cost of servicing high debt.
AMC says it has 23 of the 50 highest grossing US outlets and operates in total 346 cinemas.
Wanda said AMC's headquarters would continue to be based in Kansas City, and the company's daily operations would not change.
AMC currently employs some 18,500 staff. Wanda said it did not expect those numbers to be affected and that management staff would stay on board.
Wanda also operates hotels and department stores as well as 86 theatres, and employs 50,000 people.