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Cineworld Acquires Regal Cineworld Acquires Regal

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Cineworld Acquires Regal to Become Second Largest Global Cinema Operator

 2 min read / 

The Story

Cineworld will buy US cinema chain Regal for $3.6bn, creating the second largest global cinema group, operating 9,500 screens across ten countries. The move allows Cineworld to move into the US, the largest cinema market worldwide. The acquisition comes during a slow year for cinemas as on-demand streaming services see revenues grow.

Source: PwC

Why It’s Important

As film-goers pick on-demand services over cinemas, being a “bigger player, you’ve got more negotiating power with the Hollywood studios”, says Berenberg analyst Owen Shirley. Rival AMC, the largest global cinema company, has acted on this sentiment. The industry leader acquired US chain Carmike Cinema and Odeon & UCI Cinemas in 2016, later purchasing Nordic Cinema Group in 2017.

Consolidation may also enable movie theatres to create a better cinema experience by providing reclining seats and expanding food and beverage options at lower average costs. By making cinema’s about more than just films, they can differentiate themselves from on-demand streaming services, gaining new customers.

The deal comes amid sector-wide threats from the likes of Amazon Prime and Netflix, who provide on-demand film streaming services to consumers. Last summer’s box office sales were the worst since 2006. Consolidation and enhancing the cinema experience may help the industry survive the threat of on-demand streaming services.

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