Cineworld rights issue to raise £1.7bn (Correction)
Source - SMW
Cineworld is raising £1.7bn through a four-for-one rights issue to part fund the proposed acquisition of Regal Entertainment Group.
Cineworld announced the proposed acquisition on 5 Dec at a price of US$23.00 per Regal share, which values it at US$3.6bn, with an implied enterprise value of US$5.8bn.
The rights issue will result in the issue of 1,095,662,872 new ordinary shares.
The offer is to be made at 157p per new ordinary share - a discount of approximately 34% to the theoretical ex-rights price based on last night's closing middle-market price.
Cineworld also issued a trading update for the year ended 31 Dec.
The group said total revenues rose by 11.6% on an actual basis and by 7.9% at constant currencies.
It said: 'Admissions in both the UK & Ireland and the ROW increased compared with the prior year.
'Growth has been driven by the expansion of our estate, the improved results from the ongoing refurbishment programme and the continued roll-out of our premium formats.
'The highest grossing films for the year in the UK were "Beauty and the Beast", "Star Wars: The Last Jedi" and "Dunkirk". Locally produced films continued to perform well across the ROW, especially in Poland where "Listy Do Movie 3" and "Botoks" were the top performing films for the year.
'Retail revenue showed strong growth of 15.6% (11.8% constant currency), particularly in the ROW with growth of 29.2% (18.8% constant currency). Retail revenue is a function of admissions, economic and spending trends in each local market and was positively impacted by the expansion of the Group's retail offerings.
'The Group opened five Starbucks sites and three VIP sites in 2017 bringing the total to 29 Starbucks sites and 12 VIP sites at 31 December 2017.
'For the Group, Other Income growth has primarily been driven by the ROW, with growth in both the advertising and distribution income streams.'
At 9:37am: (LON:CINE) Cineworld Group PLC share price was -27.25p at 536.25p