Chinese company buys AMC theater chain

The $2.6 billion deal will make Wanda the largest worldwide movie operator.

By Kim Peterson May 21, 2012 12:56PM
Image: Hollywood (© Comstock/SuperStock)The largest Chinese takeover of an American company in history was just announced.

AMC Entertainment Holdings, which had filed plans for an IPO, will instead be sold to the Dalian Wanda Group out of China for $2.6 billion. What a relief for the private equity owners who wanted to unload AMC after buying the chain in 2004.

The Dalian Wanda Group, more informally known as Wanda, will now create the world's biggest movie theater operator after absorbing AMC and its 346 cinemas in North America. Wanda wants to continue to expand AMC, and said it will invest some $500 million into AMC's development in the future.

It looks like Wanda will allow AMC to run fairly independently. It will keep AMC's management and headquarters in Kansas City, and didn't initially announce any layoff plans, according to the Associated Press.

AMC had been the No. 2 movie theater operator in the U.S., with $2.5 billion in sales last year compared with the $2.7 billion for Regal Entertainment Group (RGC).

This was a nice sale for AMC's owners, which include Bain Capital and several other private equity companies. AMC has a ton of debt, and has had difficulty paying that off. The company hasn't made a profit in the recent past, but this past year its financials improved on strong ticket sales.

Apollo Global Management (APO) and a unit of JPMorgan Chase (JPM) bought AMC in 2004 for $2 billion, including debt, Bloomberg reported. The next year, AMC merged with Loews Cineplex Entertainment, which was owned by three other private equity firms.

All of those private equity owners wanted to get some money back. They tried to spin out AMC into an IPO in 2008, but withdrew. They filed again for an IPO in 2010, but shelved those plans as talks with Wanda expanded.

Before the AMC deal, the largest Chinese takeover of an American company had been Lenovo Group's $1.8 billion buyout of IBM's PC business in 2005, Bloomberg reported.



Tags: APOJPMRGC

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119Comments
May 21, 2012 4:08PM
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Nothing like American companies selling off to the CHINESE! WTF! Well I'll try not to see movies at AMC.
May 21, 2012 4:05PM
May 21, 2012 3:48PM
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I wish people would quit selling out America.  Don't want chinese in American Business yet gov and e1 is selling us out.  Guess we will have to retake our country as we took it before.  Boycott all Chinese goods and services if ya want to be called American.
May 21, 2012 4:24PM
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I remember 25 years ago when the Japanese were going to own everything in America.  Hmm......  Didn't quite work out that way for them.

The jury is still out on this.  But, if we can get the fu**ing politicians out of the way and unleash the energy industry in this country, we could be completely free of non north American energy supplies in 5 years of less.  That fact, along with our huge reserves of natural gas means that manufacturing costs would be in line or nearly as cheap as doing it in Asia (factor in shipping costs, etc.).  that means a lot of jobs start coming home to America and Canada.  Not all of them, mind you.  But, a good share will and more will stay here.

China has a tiger by the tale and it won't be easy to deal with their internal problems that no one ever hears about.

Alas, I fear the pols will figure out some way to keep this from happening.  Especially, Obama and his shills  who are trying very hard to destroy America.

May 21, 2012 5:14PM
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What a disgrace, whats next, what else are the Chinese going to own.  This country is in such sad financial state and this large companies are selling everything to the Chinese.  Our government is just to stupid to do something about this.  They are concerned about who pays for your birth control but not about selling out our country
May 21, 2012 4:12PM
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by this time in ten years how much of this country will they own? say Good Bye America!
May 21, 2012 4:35PM
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One more reason in a long list of many to avoid theaters...trying like hell to keep as many dollars local as I can, and a night at the movies with AMC won't do it
May 21, 2012 3:58PM
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Considering Asia... and China more specifically are the number 1 abusers of copyright infringement and selling of "reproduction" items... I wonder how this will affect the movies. I'd bet half of the production companies will keep their movies from being released at AMC theaters for risk that the Chinese will take the product and abuse it at home.
May 21, 2012 4:04PM
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Well, guess I'll skip getting the AMC tickets at Costco.  Hopefully the other cinema companies don't become sellouts.
May 21, 2012 5:19PM
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What a bunch of back stabbing Corporate Pigs. Slowly selling off America to whom ever. I will never go see a movie at AMC again.
May 21, 2012 4:14PM
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Now the chinese will be determining what movies Americans see!!  What a world, what a world.....
May 21, 2012 6:33PM
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While they are busy changing the name, because they are no longer "American" I will be busy looking for new theatres to attend.
May 21, 2012 4:11PM
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Oh great.  Now we get fortune cookies instead of popcorn!
May 21, 2012 5:01PM
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AMC now stands for American Morphing China...
May 21, 2012 5:53PM
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time to boycott them we need local and american owned business right now
May 21, 2012 6:42PM
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Good Bye AMC, never will sit my butt in your seats again!!
May 21, 2012 5:19PM
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Money hungry big corporations....ruining America!
May 21, 2012 6:12PM
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Well guess its time to quit going to the movies. Oh wait a minute I stopped going over 4 years ago when it cost $50 for two people to go to a movie, popcorn and a coke. Now I will never go to another movie now that China owns it. I guess all of America is for sale.
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