AMC Entertainment: Buying Opportunity Emerging, With Strong Fundamentals Intact
Johannes Salim, CFA
Johannes Salim, CFA
Mon, Jun. 20, 7:37 AM
- Carmike Cinemas (NASDAQ:CKEC) reiterates the unanimous recommendation of its board for the proposed merger agreement with AMC Entertainment (NYSE:AMC).
- The action follow two major proxy advisory firms issuing a recommendation to shareholders to vote against the deal.
- Carmike statement: “The AMC agreement is the culmination of a nearly two-year strategic review process during which no other offers were made. The AMC agreement also resulted in the highest large-scale industry transaction multiple in the past 10 years, and provides value to our stockholders that is well above where Carmike’s stock has historically traded or where we expect Carmike’s stock to trade on a standalone basis within any time frame that would be acceptable to us, particularly in light of recent industry-wide downward trends."
- Shareholders are due to vote on the merger proposal at a special meeting set for June 30.
- Source: Press Release
- Previously: AMC Entertainment faces resistance in Carmike Cinemas pursuit (June 18)
Thu, Mar. 3, 7:23 PM
- Carmike Cinemas (NASDAQ:CKEC) was up 5.9% after hours alongside confirmation by AMC Entertainment (NYSE:AMC) that it's acquiring the rival cinema chain for $1.1B. AMC was up 7.2% in after-hours action.
- The deal, at a 19.5% premium to Carmike's close, creates the largest movie theater chain in the world by combining America's second- and fourth-largest chains. The two will have 8,380 screens when combined, in more than 600 locations across 45 U.S. states.
- The two expect accretion to free cash flow per share in 2017 and beyond (excluding transaction charges), and forecast annual cost synergies of about $35M.
- Both boards have unanimously approved the deal, and it has fully committed financing in place.
- AMC will discuss the deal in a Webcast tomorrow at 8:30 a.m. ET.
- Carmike is halted in postmarket trading and is expected to resume at 8:30 p.m. ET. Its last postmarket quote was at $26.60, vs. the $30/share acquisition price.
- Previously: AMC Entertainment to buy Carmike for $1.1B (Mar. 03 2016)
Thu, Mar. 3, 7:05 PM
- Updated (7:07 PM): AMC Entertainment (NYSE:AMC) is acquiring Carmike Cinemas (NASDAQ:CKEC) in an all-cash deal for $30.00/share, a 19.5% premium to today's close of $25.11.
- The $1.1B deal combines the country’s second- and fourth-biggest movie theater chains.
- Purchase price per screen: $376K.
- Carmike (CKEC) halted.
- Related: Carmike Cinemas: Growth Strategy Becomes Even More High Visibility With Debt Maturation Optimization
Dec. 31, 2014, 8:42 AM
- Streaming: Sony (NYSE:SNE), HBO (NYSE:TWX), CBS (NYSE:CBS), and Dish Networks (NASDAQ:DISH) are set to unveil streaming products in 2015. The theory of the companies that the skinny bundles will draw in more cord-cutters and cord-nevers than they will cannibalize current pay-TV subscribers will be put to the test. The rush of streaming options could help or hurt Netflix (NASDAQ:NFLX) depending upon which analysis an investor leans on.
- Theater traffic rebound: Exhibitors (CNK, RGC, AMC, CKEC, IMAX) and movie studios (LGF, VIA, VIAB, DIS, FOXA, CMCSA, TWX) maintain that the decline in theater attendance in 2014 (-6%) was due to a slate of films light on blockbusters. A bounce is forecast for 2015 with high-profile films such as Avengers: The Age of Ultron, The Hunger Games: Mockingjay Part 2, Fifty Shades of Grey, Jurassic World, Spectre (James Bond), and Mission Impossible 5 all set to premiere - along with the reboot of the Star Wars franchise in December. Capex spending on theater upgrades could also help boost in-theater spending and average ticket price for exhibitors.
- Mergers: If regulators allow the Comcast-Time Warner Cable (NYSE:TWC) and AT&T-DirecTV (NASDAQ:DTV) mergers to sail through it could clear a path for other media combinations, note analysts. Potential buyers include Alibaba (NYSE:BABA), Wanda Group, Softbank (OTCPK:SFTBY), and a TWX-rebuffed 21st Century Fox (NASDAQ:FOXA). Content producers which could be targets include Starz (NASDAQ:STRZA), Lions Gate (NYSE:LGF), DreamWorks Animation (NASDAQ:DWA), AMC Networks (NASDAQ:AMCX), and Scripps Networks (NYSE:SNI). A split-up Madison Square Garden (NASDAQ:MSG) could also be enticing.
Apr. 24, 2014, 8:22 AM
AMC Entertainment Holdings, Inc. is principally involved in the theatrical exhibition business and owns, operates and has interests in theatres primarily located in the United States. The company owns and operates movie theatres, which are primarily located in major metropolitan markets. It... More
Industry: Movie Production, Theaters
Country: United States
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