TORONTO – AMC Entertainment Inc. has signed deals to sell six of its theatres in Canada and says it is exploring options for the remaining two locations as it focuses its attention on its business in the U.S.
“These divestitures allow AMC to focus our resources on initiatives which impact our business in the United States,” said Mark McDonald, executive vice-president of global development at the U.S. theatre company.
Shares in Cineplex Inc. (TSX:CGX), Canada’s largest theatre operator, were up 83 cents at $30.02 on Friday after announcing its deal to buy four theatres from AMC and upgrade the locations to include digital projection systems.
Under the deal announced Thursday, Cineplex will acquire AMC Ventures, which includes the theatres in Toronto, Oakville, Ont., Mississauga, Ont., and Montreal, for a nominal price.
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Meanwhile, Empire Theatres Ltd., the country’s second-largest theatre chain, said it will buy AMC theatres in Kanata, Ont., and Whitby, Ont.
The two remaining AMC theatres are in Scarborough, Ont. and Concord, Ont.
Box office receipts have been lacklustre across North America so far this year, with The Avengers being one of the few big blockbuster hits. Other big budget films like Battleship and John Carter have flopped.
Some Canadians are also choosing to stay home and avoid the box office ticket prices as they tighten their belts amid continued economic uncertainty.
The sale also means less competition for Canada’s two biggest theatre chains.
With the acquisition announced Thursday, Cineplex will own, lease or have a joint-venture interest in 134 theatres with 1,445 screens.
Empire said the deal helps build its strategy of growing its footprint across Canada.
Empire Theatres is a subsidiary of Empire Co. Ltd. (TSX:EMP.A), which also owns the Sobey’s chain of supermarkets. With the AMC theatres, the chain now owns and operates 53 theatres across Canada with 438 screens.
Empire shares were up 24 cents at $53.80 on the Toronto Stock Exchange.
Chinese conglomerate announced last month it will buy a major U.S. cinema chain, AMC Entertainment Holdings, for $2.6 billion in China’s biggest corporate takeover in the United States to date.
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