Sony, Cineplex $1-Billion Deal Faces Scrutiny

Sony Corp.’s proposed $1-billion combination of its theater operations with Cineplex Odeon Corp. faces close scrutiny from U.S. antitrust authorities, according to a regulatory filing.

Sony’s Loews Theatres and Cineplex disclosed that the Justice Department on Nov. 14 issued a request for more information about their plans to create one of North America’s dominant movie theater chains.

That action, under U.S. law, signals that a merger will get a careful and likely extended look from antitrust authorities and delays completion of a transaction until the companies provide often massive amounts of information about their market shares, future business plans and other matters.

In a filing with the U.S. Securities and Exchange Commission describing plans for the merged operation, the companies said they plan to “close overlapping theater locations” and “dispose of or close older, obsolete theaters.”