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Transforming the moviegoing experience
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Cineworld saw the opportunity to evolve the cinema experience in the US. Their longtime partners in Barclays’ Corporate Broking and Investment Banking teams helped them seize the opportunity.

For years, Cineworld defined cinema experiences in Europe. Brothers Mooky and Israel Greidinger, CEO and Deputy CEO of Cineworld respectively, have long shared the belief that a night out at the movies is an occasion—an experience rivaling dinner at a starred restaurant, a concert or a sporting event. They applied this vision and grew a family business to be the second largest exhibitor in Europe, and their next move was to expand their vision to the US market.

In 2017, the market had a bearish outlook for the cinema industry, driven by a decline in box office revenues and overstated headwinds from video streaming. Yet the brothers saw the opportunity to enter the US market—the largest box office in the world—via a reverse takeover of Regal Entertainment. At the time, Regal was the #2 cinema operator in the US with 18% market share, and three times the size of Cineworld.

The Greidinger brothers believed that by acquiring a company like Regal Entertainment with a huge footprint across the US, they could transform movie-going in America as they had in Europe. It was a logical, if daring, decision.

Acquiring Regal Entertainment led to a 330% increase in screens worldwide
Acquiring Regal Entertainment led to a 330% increase in screens worldwide

“The plan to take over Regal was an ambitious one,” Mark Astaire, Chairman, Corporate Broking and Vice Chairman, Investment Banking for Barclays, says. “But they are cinema people through and through. They’re absolutely brilliant at it.”

How it happened

A UK company proposing to take over an American company three times its size? “People thought we were crazy,” Mooky Greidinger says. It wasn’t a typical deal. It was an anomaly. When the brothers decided to seize the opportunity, Barclays was there to support their vision.

Cineworld had banked with Barclays for a long time, so there was a deep relationship and an inherent level of trust, as well as a strong knowledge of the business and industry. And with a large presence in the US and the UK, Barclays had the cross-border capabilities and acumen to help make the deal happen.

Barclays was a lead bank on the deal that moved Cineworld to an implied enterprise value of US$5.8bn, acting as Financial Advisor and Corporate Broker to Cineworld as well as Joint Global Coordinator and Joint Underwriter on both the rights issue and debt acquisition financing. Barclays also provided Ratings Advisory services as well as risk and hedging solutions to Cineworld in the context of the acquisition.

From start to finish, the deal took just six months because of the determination of the large team of bankers and Cineworld’s senior management team, under the leadership of the Greidinger brothers. To ensure that investors maintained their confidence in the brothers and their vision, Israel and Mooky committed to maintaining their ownership level in Cineworld at 28% and buying into the rights issue.

Cinema is in their blood. They’ve taken a family business, and grown it into the largest markets in the world.
Daniel Ross, Co-Head of TMT, EMEA, Barclays

Igniting growth in a new market

The acquisition of Regal Entertainment has catapulted Cineworld to become the second largest exhibitor in the world by number of screens.

Cineworld movie screens in Europe and the US post acquisition
Acquiring Regal Entertainment led to a 330% increase in screens worldwide

Managed by a team with a track record of creating value, Cineworld is poised to transform the movie experience for Americans, with their relentless investment in the best seats, best sound and best picture quality. The Greidingers’ commitment to their vision ‘to be the best place to watch a movie’ continues to better the experience in all of their markets.

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