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21

Nov

Cinema City Publishes Issue Prospectus

  • Subscription orders placed for Cinema City shares by Retail Investors will be accepted from November 24th to November 30th at the branches of Biuro Maklerskie Banku BPH S.A. and Centralny Dom Maklerski Pekao S.A.
  • The total number of offered shares is 15.66m, of which 10m are new issue shares.
  • CA IB Securities S.A. will act as the offeror.


Public Offering Schedule

Subscription orders for shares in Cinema City, the largest operator of multiplex cinemas in Central and Eastern Europe, will be accepted from Retail Investors in the period from November 24th to November 30th at the branches of Biuro Maklerskie Banku BPH S.A. and Centralny Dom Maklerski Pekao S.A. located throughout Poland.

Subscription orders placed by Retail Investors will be accepted at the maximum price, to be announced on or about November 23rd.

A book-building process is carried out from November 20th to November 30th among Institutional Investors in Poland and abroad. The price of offered shares will be established based on the results of the process. Institutional Investors will place subscription orders for the Company shares at 1st and 4th December.

Structure of the Offering

The Offering will comprise new and existing Cinema City shares in a total number of over 1 5.66m, of which:

  • 10m will be new issue shares
  • 5.66m will be existing shares sold by the existing shareholders, including Israel Theatres Limited (company controlled by the Greidinger family -founders of Cinema City).


In addition, in order to cover additional investors' demand, up to 2,35m additional shares may be sold by existing shareholders as part of the overallotment option.

The final number of offered shares is expected on November 30th.

The Public Offering in Poland is addressed to both Retail and Institutional Investors. Retail Investors may be allotted 20% of the total number of shares in the Offering, however, this percentage is subject to change.

Assuming all offered shares (15,66m) are sold new shareholders will hold almost 31% of the Company shares. The controlling stake of almost 70% will be retained by I.T. International Theatres Ltd. (controlled by the Greidinger family) currently holding over 86% of Cinema City shares.

Planned schedule of the Public Offering*:

November 20th-30th Book-building among Institutional Investors
November 23rd Determination of the Maximum Price
November 24th-30th Placement of subscription orders by Retail Investors
November 30th Determination of the Share Price and the final number of Offered Shares
December 1st and 4th Placement of subscription orders by Institutional Investors
December 4th Allotment date

    
*the final dates may change

Strategy and Issue Objectives of Cinema City

“We want Cinema City shares to be listed on the Warsaw Stock Exchange given the very good prospects of the Polish capital market and the fact that Poland is the key market of our operations, which last year generated more than 43% of the Company’s consolidated revenue,” said Moshe J. Greidinger, Cinema City’s CEO.

Cinema City plans to invest the proceeds from the issue of new shares in further development of its operations in Central and Eastern Europe and in Israel. “We intend to strengthen our leading position among multiplex operators. Our investment plans provide for the opening of approximately 25 new multiplexes, including 10 in Poland, by the end of 2008,” said Moshe J. Greidinger.

The value of the investment plan for the next two years is estimated at approx. EUR 88m (of which EUR 61m under existing contracts and agreements for the construction of 17 multiplexes). The Company will finance its investments primarily with the issue proceeds and funds generated from operations.

The Company’s key strategic objectives include:

  • Further strengthening its position in the existing markets. Cinema City intends to consolidate its position as a leading operator in Poland, Hungary, the Czech Republic, Bulgaria and Israel. In the coming two years, the Company plans to launch 21 new cinemas in theses markets, of which ten will be located in Poland, two in Israel, one in Hungary (flag-ship megaplex in Budapest downtown) and four in each of Bulgaria and the Czech Republic
  • Expanding into new markets in Central and Eastern Europe. Based on the same operating model as used in Poland, the Czech Republic, Bulgaria and Hungary, Cinema City plans to launch its activities in other countries of the region. The Company has already taken initial steps to open four new multiplexes in Romania.
  • Earning profits by developing real estate projects, connecting to the development of multiplex chain. . Chiefly as part of the cinema development plan, Cinema City intends to continue to pursue new real estate development projects by identifying and developing the most advantageous projects in shopping mall market.

 This publication is for promotional purposes only. The offering prospectus (the "Prospectus") prepared in English and approved on 17 November 2006 by Autoriteit Financiële Markten (the "AFM"), the Dutch capital markets authority, is the sole legally binding document containing information on Cinema City International N.V. (the "Company") and its initial public offering (the "Offering"). Komisja Nadzoru Finansowego, the Polish capital markets authority, has received from the AFM a certificate of approval of this Prospectus, for the purpose of authorising the Offering to the public in Poland.

The Prospectus was published on 21 November 2006 on the website of the Company (www.cinemacity.nl) and the Warsaw Stock Exchange (www.gpw.com.pl).

For convenience of investors, the Company has printed Polish translation of the Prospectus which is available at the customer service points Biuro Maklerskie Banku BPH S.A. and Centralny Dom Maklerski Pekao S.A.

Neither this document nor any part or copy of it may be taken or transmitted into the United States ("US") or distributed, directly or indirectly, in the US. The distribution of this document in other jurisdictions may be restricted by law, and persons into whose possession this document comes should inform themselves about, and observe, any such restrictions. Any failure to comply with these restrictions may constitute a violation of US securities laws. The Company's shares have not been and will not be registered under the US Securities Act of 1933 (the "Securities Act") and may not be offered or sold in the US except pursuant to an exemption from, or transaction not subject to, the registration requirements of the Securities Act.

This document does not constitute or form part of any offer or invitation to sell or issue, or any solicitation of any offer to purchase or subscribe for any shares in the Company, nor shall it or any part of it nor the fact of its distribution form the basis of, or be relied on in connection with, any contract or investment decision.

Any purchase of shares in the Offering should be made solely on the basis of the information contained in the Prospectus. No reliance may be placed for any purposes whatsoever on the information contained in this document or on its completeness, accuracy or fairness. The information in this document is subject to verification, completion and change.