Shareholders of Kansas City-based AMC will get $19.50 a share in cash, translating into a premium of nearly 14 percent over AMC's Wednesday closing share price.
It also represents a 37 percent premium to AMC's closing share price of $14.22 on Monday, when news that a deal was in the offing leaked. The stock dropped 4 cents to $36.78 on Thursday.
After a morning trading halt, shares of AMC rose $1.96, or more than 11 percent, to $19.12. They earlier hit a 52-week high of $19.20.
The transaction includes $1.67 billion in cash, $349 million in assumed debt and $399 million in cash and cash equivalents.
J.P. Morgan Partners will own 50.1 percent of AMC, while private investment firm Apollo Management will own 49.9 percent.
AMC, a leading movie theater chain, currently operates 232 theaters in the United States and seven other countries. Senior management will retain their positions after the transaction is completed.
The latest
The AMC transaction is the latest bringing together a movie exhibitor company and a buyout firm.
In June, Bain Capital, Carlyle Group and Oaktree Capital Management agreed to buy Loews Cineplex Entertainment for $1.46 billion. And earlier this year, Madison Dearborn Partners bought out Cinemark theater chain for about $1.5 billion.
But shares of Regal Entertainment Group /quotes/zigman/303770/quotes/nls/rgc RGC -1.30% got little residual lift from news of AMC's deal. Centennial, Colo.-based Regal rose 18 cents, or 1 percent, to $18.17.
Earlier, Loews and AMC also engaged in merger talks that eventually went nowhere. See story.
The independent directors of AMC's board recommended the sale of the movie chain to investment vehicle Marquee Holdings. Apollo and Durwood Voting Trust, two shareholders of AMC, are also supporting the deal.
Pending regulatory and shareholder approval, the transaction is expected to close in the fourth quarter, at which time AMC's shares will no longer trade on the American Stock Exchange.
Lazard advised AMC's independent committee, while two law firms -- Polsinelli Shalton Welte Suelthaus and Richards Layton & Fingers -- served as legal counsel. Goldman Sachs /quotes/zigman/188479/quotes/nls/gs GS +0.93% and Skadden Arps Slate Meagher & Flom represented AMC.
Meanwhile, Citigroup Global Markets /quotes/zigman/5065548/quotes/nls/c C +1.54% advised Apollo. Latham & Watkins represented J.P. Morgan Partners and Wachtell, Lipton Rosen & Katz provided legal advice.
Also Thursday, AMC Entertainment said it earned $8.8 million, or 17 cents a share, in the first quarter ended July 1, compared with $2.7 million, or 7 cents, earned a year ago. The average estimate of analysts polled by Thomson First Call was for a profit 15 cents a share.
AMC's quarterly revenue rose 4 percent, reaching $489 million.
No comments:
Post a Comment