Cinema City: Credit Agreement with BZ WBK for PLN 60 million. Financing growth in Poland and Romania (26 March 2009)
Cinema City Poland, a subsidiary of Cinema City International N.V. (“Cinema City”), has signed a PLN 60 million credit agreement with the bank BZ WBK. The funds will be used to finance development of the Cinema City circuit in Poland and Romania.
Cinema City is intensively developing its multiplex network. In 2008 alone, the company opened 7 multiplexes, with 94 screens, in 5 different countries. Currently the Company has 45 multiplexes under development with over 470 screens. The credit made available to Cinema City by BZ WBK will support the investments specifically in Poland and Romania, two key operating markets for the Company.
“Today we continue our long-standing cooperation with BZ WBK” said Nisan Cohen, deputy finance director of Cinema City, the largest multiplex cinema operator in Central & Eastern Europe and in Israel. “We appreciate the fact that the bank is demonstrating its confidence in us especially during this difficult time of economic downturn.”
Under the agreement, the credit is granted for a period of 6 years. The total of PLN 60 million can be withdrawn until the end of March 2010. Repayment of capital installments will begin in March 2011 and run through the end of 2014. The amount of PLN 15 million will be repaid at the end of the repayment period in 2014. The interest rate on the credit equals the 3-month WIBOR +2.75%.
Poland is the largest operating market for Cinema City, where the company operates 25 multiplexes with 278 screens. 20% of screens under development (96 screens) are located in Poland in 8 projects. Romanian screens accounts today for 5% of the total number of screens while over 60% of the screens under development today (280 screens) will be operated in this country. Thus in the next 2 to 3 years Romania will be the Cinema City’s second-largest market of operations.
“We intend to grow organically. Both in Poland and in Romania, we are planning to sign more leases for cinema space” Nisan Cohen said.
Mr Krzysztof Nieć, BZ WBK Managing Director of Corporate Banking Centre in Wrocław, comments: “Cinema City is our client for many years and we witness its fast development through this time. We are particularly happy that the Company is expanding theatre operations in Poland and Romania using BZ WBK credit. Our Bank supports clients with good records in co-operation which enjoy our high credibility.”
Cinema City International is the largest multiplex cinema operator in Central & Eastern Europe and in Israel. The Company operates 64 multiplexes with 592 screens, in 6 countries (Poland, the Czech Republic, Hungary, Romania, Bulgaria and Israel). There are 45 more multiplexes under development, which will offer additional 476 screens. In addition, Cinema City is actively involved in cinema related advertising and film distribution.
The Cinema City group employs over 3,000 people in 6 countries.