Cineworld Group plc Sale and Leaseback of Additional 18 US Cinemas (0377C)
13 June 2019 - 4:01PM
UK Regulatory
TIDMCINE
RNS Number : 0377C
Cineworld Group plc
13 June 2019
Cineworld Group plc ("Cineworld") announces sale and leaseback
of an additional 18 US-based cinemas
13 June 2019
Further to the announcement made by Cineworld on 15 May 2019,
Cineworld today announces the signing and completion of an
additional sale and leaseback transaction relating to 18 US-based
multi-screen cinemas totalling 255 screens (the "Sale and
Leaseback", or the "Transaction"). The Transaction is consistent
with Cineworld's existing business model of operating a
predominantly leasehold estate and long-term strategy of
crystallising value for its shareholders.
The Transaction involves Cineworld selling the cinemas to a
subsidiary of EPR Properties ("EPR") for cash consideration of US$
270.0 million and leasing them back under 15-year leases on
customary terms. The cinemas had a book value of US$ 230 million at
the end of 2018 including an uplift on revaluation as part of the
acquisition of Regal and generated EBITDA of US$ 42.5 million in
2018.
As outlined in the announcement made by Cineworld on 15 May
2019, the Board has considered the appropriate use of combined
proceeds from both this Transaction with EPR and the sale and
leaseback of 17 US-based cinemas referred to in that announcement.
Of the combined cash consideration of US$ 556.3 million, the Board
utilised half of the proceeds to reduce gross debt and will return
the second half to shareholders by way of a special dividend.
As such, the Board of Cineworld announces that it will pay a
special dividend of US 20.27 cents per ordinary share, with an
aggregate value of US$ 278.1 million. The timetable for this
special dividend is as follows:
Announcement 13 June 2019
Ex-Dividend Date 20 June 2019
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Record Date 21 June 2019
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Final Date for Currency Election 21 June 2019
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Special Dividend Exchange 21 June 2019
Rate Determined
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Payment Date 5 July 2019
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Following the completion of the Transaction and the sale and
leaseback completed in May 2019, Cineworld remains comfortably on
track to deliver reduced leverage in line with expectations.
Anthony Bloom, Chairman of Cineworld Group plc, said:
"We are pleased to confirm today the use of proceeds from our
two recent sale and leaseback transactions - highlighting our
commitment to deleveraging and our strategy of generating strong
total returns for our shareholders."
Mooky Greidinger, Chief Executive Officer of Cineworld Group
plc, said:
"I am very pleased to announce this further sale and leaseback
transaction today. We have now realised the value of 35 properties
acquired as part of the Regal transaction and further optimised our
business in line with our leasehold operating model. We are
delighted to have completed this transaction with EPR, a business
we already worked closely with prior to the transaction as a
significant landlord of properties in the Regal estate.
As recently highlighted, we have been spending a lot a time in
the United States since the acquisition of Regal and remain very
excited about the progress we made to date and the outlook going
forward. In particular, the integration of Regal is on plan and we
are on track to deliver on our synergy plans for 2019."
About Cineworld Group plc
Cineworld Group plc was founded in 1995 and listed its shares on
the London Stock Exchange in May 2007. The company has grown
through expansion and by acquisition to become the second largest
cinema chain worldwide, holding the number one or number two
position by number of screens in each of its regions. Cineworld
currently operates 9,503 screens across 788 sites in the US, UK,
Ireland, Poland, the Czech Republic, Slovakia, Hungary, Bulgaria,
Romania and Israel.
About EPR Properties
EPR Properties is a specialty real estate investment trust
(REIT) that invests in properties in select market segments which
require unique industry knowledge, while offering the potential for
stable and attractive returns. The company's investments exceed
$6.9 billion and its primary investment segments are Entertainment,
Recreation and Education. The company adheres to rigorous
underwriting and investing criteria centered on key industry and
property level cash flow standards. The company believes its
focused niche approach provides a competitive advantage, and the
potential for higher growth and better yields.
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END
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