Carmike Cinemas is all set to acquire Sundance Cinemas for $36 million in cash, subject to customary working capital and other adjustments.
Carmike Cinemas is a pioneer in digital cinemas, alternative programming and 3D motion picture presenter. Following the completion of the transacton, Carmike operated 274 theatres with 2909 screens in 41 states. Billionaire Howard Mark’s Oaktree Capital Group is the primary investor in the Sundance chain. The acquisition would position Carmike no 4 in domestic theater operator, offer opportunities to expand its upscale cinemas, provide scope for its growth in the industry. Carmike claims that the purchase would add-on to profit immediately.
Carmike’s President and Chief Executive Officer David Passman said, “Sundance has been enormously successful in creating a compelling consumer experience and shares our mission and vision of offering a world-class movie-going experience, including an impressive premium dining offering. Not only are these five theaters located in complementary locations with limited geographic overlap with our existing circuit, but they also offer tremendous opportunity to implement Carmike’s proven and successful guest experience strategies and combine our resources to achieve greater innovation that will benefit consumers, theater operations and increase shareholder value. We expect that this acquisition will allow Carmike to capture proportionally higher attendance rates for non-blockbuster titles and provide additional luxury expansion opportunities and meaningful cost synergies as we increase scale to optimize film exhibition and other support costs.”
Paul Richardson, Sundance Cinemas’ Chief Executive Officer commented “We are excited to join Carmike which brings together two exceptional organizations with a common culture of innovation and customer focus. Sundance has worked hard to deliver the highest levels of customer service across our theaters and we look forward to working together to increase Carmike’s leadership position in cinema dining and overall movie-going experience.”
Though the transaction does not provide for the expansion of the Sundance brand under Carmike’s ownership, Carmike will be able to continue to operate Sundance’s five theatres under the Sundance brand under the license with Sundance Enterprises Inc.