Film-Tech Forum ARCHIVE: For Sale: AMC Theatres

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Posted by Mark J. Marshall (Member # 1409) on 07-21-2004, 11:52 AM:

Linky

AMC Shares Surge on Buyout Reports
7/20/2004 4:17:00 PM

KANSAS CITY, Mo., Jul 20, 2004 (AP Online via COMTEX) -- AMC Entertainment Inc.'s shares surged more than 22 percent Tuesday on reports that private equity firm J.P. Morgan Partners was negotiating to buy the movie theater company.

J.P. Morgan Partners, the private equity arm of J.P. Morgan Chase & Co., is in "advanced talks" to take AMC private for $19 to $20 per share, plus assumption of debt, The New York Post reported Tuesday. The Post, citing unidentified sources, said terms were still being negotiated and the deal could still fall through.

Officials with J.P. Morgan Partners and Kansas City-based AMC didn't immediately return phone calls Tuesday from The Associated Press seeking comment.

Shares in AMC rose $3.19 to $17.41 in afternoon trading on the American Stock Exchange.

AMC, the industry's second-largest chain, and Loews Cineplex, the No. 4 chain, had said in late 2003 that they were discussing a possible merger that would have created a rival to industry leader Regal Cinemas. But nothing came of the talks, which the companies ended in January.

A group of investors led by Bain Capital bought Loews last month for $1.46 billion. That came on the heels of a deal in March in which Madison Dearborn Partners bought Cinemark Inc., the No. 3 theater chain, for $1.6 billion.

Analysts said they see this year's buying spree as proof the theater industry is finally recovering from the struggles of the late 1990s. During that time, most theater chains invested heavily in building new megaplex-style theaters and several had to declare bankruptcy.

AMC avoided bankruptcy and has been working to eliminate debt. In addition, AMC and some other chains did not built many new theaters, and instead leased properties from developers or specialty landlords.

"Investors are looking for companies with stable business models and fairly high free cash-flow returns and attractive yields," said analyst Jeffrey Logsdon of Harris Nesbitt.

Logsdon said AMC's growth plans would not likely change as a private company and it could actually save money on the many legal and regulatory requirements imposed on public companies.

AMC operates 232 theaters with 3,554 screens in the United States, Canada, France, Hong Kong, Japan, Portugal, Spain and the United Kingdom. The company had revenues last year of $1.8 billion.

Posted by Dean Kollet (Member # 1789) on 07-21-2004, 12:36 PM:

damnit, I was just gonna buy AMC stock the other day too [Mad]

Posted by John T. Hendrickson, Jr (Member # 849) on 07-21-2004, 08:00 PM:

Save your money. Unless you get in on the ground floor in the theater business, you'll be left holding the bag.

The acquisition of theaters isn't about operation of theaters at a profit. It's a demonstration of "growth". The smart people drive up the price, then sell out to leave the bondholders and the stockholders holding the bag.

There are many more attractive investments out there, but there are always suckers to buy the exhibition company stocks.

Posted by Richard Fowler (Member # 893) on 07-21-2004, 09:22 PM:

I have a friend who bought AMC at the dollar level in late 2001....he is very happy with the current $17 price. He bought what he knew as a cinema owner himself [Smile]

Posted by Mark J. Marshall (Member # 1409) on 07-22-2004, 11:30 AM:

Sold. Thanks for all the inquiries! [Big Grin]

AMC to Be Sold in Deal Worth $2 Billion
7/22/2004 12:02:00 PM

KANSAS CITY, Mo., Jul 22, 2004 (AP Online via COMTEX) -- AMC Entertainment Inc., the nation's second-largest theater exhibition company, said Thursday it will be sold in a deal worth $2 billion.

Marquee Holdings Inc., a joint operation of private equity firm J.P. Morgan Partners and AMC's current majority owner, Apollo Management LP, plans to buy the company and take it private, paying stockholders $19.50 per share.

AMC shares were selling at $17.16 on the American Stock Exchange Thursday before trading was halted for the announcement. The offer from Marquee Holdings represents a 14 percent premium on that, and 37 percent over what the shares were worth Monday when published reports said J.P. Morgan Partners was looking to buy the company.

If approved by shareholders and regulators, J.P. Morgan Partners - the private equity arm of J.P. Morgan Chase & Co. - would own 50.1 percent of the company. AMC's existing management would continue to run the company.

AMC said the deal includes $1.67 billion in equity and the assumption of $748 million in debt less $399 million in cash and equivalents.

If consummated, it would be the third deal involving a theater company this year. A group of investors led by Bain Capital bought Loews Cineplex, the No. 4 chain, last month for $1.46 billion. In March, Madison Dearborn Partners bought Cinemark Inc., the No. 3 theater chain, for $1.6 billion.

AMC and Loews had said in late 2003 that they were discussing a possible merger that would have created a rival to industry leader Regal Cinemas. But nothing came of the talks, which the companies ended in January.

AMC operates 232 theaters with 3,554 screens in the United States, Canada, France, Hong Kong, Japan, Portugal, Spain and the United Kingdom. The company had revenues last year of $1.8 billion.

Posted by John T. Hendrickson, Jr (Member # 849) on 07-22-2004, 10:58 PM:

Precisely my point, Richard. Your friend got in on the ground floor.

Posted by Tim Reed (Member # 137) on 07-23-2004, 11:20 AM:

What can they possibly want with AMC?

Posted by Mark J. Marshall (Member # 1409) on 07-23-2004, 02:21 PM:

Hopefully to get rid of a lot of the excess corporate weight that's dragging the company down. AMC is getting w-a-y too top heavy again.

Posted by Floyd Justin Newton (Member # 1316) on 07-26-2004, 12:01 PM:

It's about damn time.
[thumbsdown]

fjn
Local 294 Ret.

Posted by Edward Jurich (Member # 1787) on 07-26-2004, 06:22 PM:

I went to see "Notebook" at the AMC 20 in Independence (Kansas City) and as past visits, the surrounds were so load they drowned out the screen at times. Perhaps it'll be set correct now [Cool]

Posted by Dustin Mitchell (Member # 372) on 07-26-2004, 07:43 PM:

Yes but then people will complain that the 'surrounds aren't working' [Roll Eyes]

Posted by Mark J. Marshall (Member # 1409) on 07-26-2004, 10:23 PM:

Ours typically produce static in a couple of our auditoriums.

Posted by Mitchell Dvoskin (Member # 751) on 07-27-2004, 08:02 AM:

AMC to Be Sold in Deal Worth $2 Billion

Gee, I sold my AMC Hornet station wagon for $700. I knew I should have held out for $1 Billion...

Posted by Dennis Benjamin (Member # 1137) on 07-28-2004, 07:39 PM:

http://www.kansascity.com/mld/kansascity/business/9230357.htm

quote:
AMC Sued Over Planned Buyout; Multiple Filings at SEC
7/27/2004

"AMC Entertainment Inc., which on Thursday revealed it's going private, is being sued along with one of the entities buying the Kansas City-based movie exhibitor," reports the Kansas City Star.
Also: The following recent SEC filings relate to AMC: 8-K: "On July 26, 2004, AMC Entertainment Inc., together with Marquee Holdings Inc. and Marquee Inc., issued a press release announcing the commencement of an offering by (i) Marquee Inc. of $150 million aggregate principal amount of its Senior Notes due 2012 and $305 million aggregate principal amount of its Senior Floating Rate Notes due 2011 and (ii) Marquee Holdings Inc. of its Senior Discount Notes due 2014, which will generate aggregate gross proceeds of $170 million, each in a private placement offering."

8-K: "On July 22, 2004, AMC Entertainment Inc. entered into a merger agreement pursuant to which AMC Entertainment Inc. will be acquired by Marquee Holdings Inc., a newly created investment vehicle owned by affiliates of J.P. Morgan Partners, the private equity arm of JPMorgan Chase & Co., and affiliates of Apollo Management, L.P., a private investment firm. Upon consummation of the merger, Marquee Inc., a wholly-owned subsidiary of Marquee Holdings Inc., will merge with and into AMC Entertainment, Inc., with AMC Entertainment Inc. remaining as the surviving entity. The closing of the merger is subject to certain terms and conditions customary for transactions of this type, including receipt of shareholder and regulatory approvals and the completion of financing."

8-K: "We are furnishing information under this Form 8-K regarding our projections of screen openings, screen closings, capital expenditures and proceeds from sale/leasebacks for fiscal years 2005 through 2007."

SC 13D/A Amended General Statement of Beneficial Ownership: For Apollo Investment Fund IV, L.P.

For access to the SEC filings in HTML, PDF or Excel format, go to http://www.investor.amctheatres.com/edgar.cfm.

[ 07-29-2004, 08:02 AM: Message edited by: Dennis Benjamin ]