Company Extracts Value from Non-Core Asset Sale
to Strengthen Balance Sheet
TORONTO, Nov. 22,
2023 /CNW/ - (TSX: CGX) – Cineplex Inc.,
Canada's leading entertainment and
media company, announced today that it has entered into a
definitive agreement with OpenGate Capital ("OpenGate") to sell
Player One Amusement Group ("P1AG"), the Company's amusement
solutions division.
OpenGate will acquire all of the issued and outstanding common
shares of P1AG for a total purchase price of $155 million in cash, subject to customary
post-closing adjustments (the "Transaction"). The Transaction
unlocks tremendous value for Cineplex and its stakeholders, while
providing immediate liquidity for repayment of net proceeds against
the Company's credit facility. The Transaction is expected to close
in the first quarter of 2024 and is subject to regulatory approvals
and other customary closing conditions. As part of the Transaction,
P1AG has entered into a long-term agreement to continue to supply
and service amusement games in Cineplex's theatres and
location-based entertainment venues.
"We proudly built the P1AG business, through several
acquisitions and organic growth, to become a North American leader
in amusement gaming solutions which has delivered strong,
consistent results, especially coming out of the pandemic. As we
continue to focus on our growth plan, the strategy to divest P1AG
came at an opportune time to strengthen our balance sheet," said
Ellis Jacob, President and
CEO, Cineplex. "We thank the talented employees of P1AG, and
we look forward to working with them as a commercial partner and
supplier to Cineplex going forward."
Scotiabank and TD Securities are serving as financial advisors
to Cineplex, and Goodmans LLP is serving as the Company's legal
advisor in connection with the Transaction.
About Cineplex
Cineplex (TSX:CGX) is a top-tier Canadian brand that operates in
the Film Entertainment and Content, Amusement and Leisure, and
Media sectors. Cineplex offers a unique escape from the everyday to
millions of guests through its circuit of over 170 movie theatres
and location-based entertainment venues. In addition to being
Canada's largest and most
innovative film exhibitor, the company operates Canada's favourite destination for 'Eats
& Entertainment' (The Rec Room), complexes specially designed
for teens and families (Playdium), and a newly launched
entertainment concept that brings movies, amusement gaming, dining,
and live performances together under one roof (Cineplex Junxion).
It also operates successful businesses in digital commerce
(CineplexStore.com), alternative programming (Cineplex Events),
motion picture distribution (Cineplex Pictures), cinema media
(Cineplex Media), digital place-based media (Cineplex Digital
Media) and amusement solutions (Player One Amusement Group).
Providing even more value for its guests, Cineplex is a partner in
Scene+, Canada's largest
entertainment and lifestyle loyalty program.
Proudly recognized as having one of the country's Most Admired
Corporate Cultures, Cineplex employs over 10,000 people in its
offices and venues across Canada
and the United States. To learn
more, visit Cineplex.com.
Caution Regarding Forward-Looking
Information
Certain statements in this news release may contain
forward-looking information (identified by words such as "will",
"anticipates", "expects", "intends" and similar expressions
suggesting future events or future performance). Such
forward-looking information is based on expectations and
assumptions made by Cineplex and is subject to risks and
uncertainties which may be beyond Cineplex's control. Readers
are cautioned that undue reliance should not be placed on
forward-looking information as actual results may vary materially
from the forward-looking information. A comprehensive
discussion of risks that may impact Cineplex can be found in
Cineplex's public reports and filings, which are available under
the Company's profile on Sedar+ (www.sedarplus.ca). Cineplex
does not undertake to update, correct or revise any forward-looking
information as a result of any new information, future events or
otherwise, except as may be required by applicable law.
SOURCE Cineplex