Cinépolis may join bidders for Regal Entertainment
Cinépolis, Latin America’s largest theater chain known for its luxury amenities, may be among the prospective bidders for the United States’ largest theater chain.
Adrian Mijares Elizondo, chief executive of Cinépolis USA, said his company would consider buying Regal Entertainment after the Knoxville, Tenn., company surprised investors last week when it announced that it would entertain offers to sell the chain.
“It’s not every day that the biggest chain in the industry goes on sale,” Elizondo said. “We would take a look at Regal. This is a growth opportunity, and like any growth opportunity we have available, we will discuss it and evaluate it.”
While Elizondo declined to comment specifically on the merits of acquiring Regal, he said the sale of the circuit would have far reaching effects on the exhibition industry.
“Whoever does acquire it would become the biggest player in the industry,” he said. “This could be a big game changer in the industry.”
Buying Regal would certainly give Cinépolis a much larger foothold in the U.S. market, where it has already established a presence in Southern California with its brand of premium cinemas, where patrons can order food and cocktails from plush reclining chairs.
The chain has 396 locations worldwide and 3,454 screens.
Cinépolis opened its first U.S. theater in Del Mar in 2011 and now has five luxury theaters in Westlake Village and Orange and San Diego counties that sell beer, wine and cocktails along with gourmet food.
The chain plans to open two more theaters in Florida next year and to expand elsewhere in the country by catering to affluent customers who are willing to pay more for premium services at the multiplex.
Regal, which is controlled by Denver billionaire Phil Anschutz, said its board of directors had retained Morgan Stanley & Co. as its financial advisor in the review process.
Industry insiders say other likely bidders for Regal would include Cinemark, the nation’s third-largest chain; Shanghai Film Group Corp.; and Chinese e-commerce giant Alibaba, whose founder Jack Ma recently visited with Hollywood executives to discuss possible partnerships with studios.
Another potential buyer is CJ Group, the South Korean conglomerate that operates Asia’s largest theater chains and already has a familiarity with the Regal brand.
The company opened “4-D” theater at Regal Cinemas L.A. Live Stadium 14 this summer. The theater combines moving and vibrating seats with wind, strobe, fog, rain and scent-based effects, all of which are synchronized to the action on screen.
The last sale of a major theater chain came in 2012 when China’s Dalian Wanda Group bought AMC, the nation’s second-largest, for $2.6 billion. Wanda is not considered a likely buyer given potential anti-trust problems an acquisition would pose for the Chinese company.
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