Closing of a share and asset purchase agreement with Palace Cinemas (Central Europe) BV
The Board of Managing Directors of Cinema City International N.V. (the "Company") informs that on 19 January 2011 the Company signed a share and asset purchase agreement (the “Agreement”) with Palace Cinemas (Central Europe) BV (“Palace Cinemas”, the “Seller”), a company controlled by Argus Capital. Under the Agreement the Company is buying from the Seller 100% shares in each of their four subsidiaries: Palace Cinemas Czech s.r.o., Palace Cinemas Hungary Kft, Palace Cinemas Slovak Republic s.r.o. and Palace Multikino s.r.o. and related assets.
Palace Cinemas Czech s.r.o., a company incorporated under Czech law, operates a chain of 8 multiplexes with 65 screens and it has a leasing agreement for 1 multiplex with 8 screens planned to be opened in 2012. Palace Cinemas Hungary Kft, a company incorporated under Hungarian law, operates 4 multiplexes with 47 screens. Palace Cinemas Slovak Republic s.r.o., a company incorporated under Slovak law, operates 2 multiplexes with 20 screens and Palace Multikino s.r.o., a company incorporated under Slovak law, operates 1 multiplex with 9 screens.
The Company is acquiring in total 15 multiplexes with 141 screens in three countries. The list of multiplexes is set out in the appendix 1 to this report. Following this acquisition Cinema City International will operate 90 multiplexes with 866 screens in 7 countries.
Under the Agreement during transitional period the Company will be also rendering selected management services for the multiplexes operated by Palace Mozi Kft, a company incorporated under Hungarian law which operates 8 multiplexes with 48 screens.
The purchase price, payable at Closing, is €28 million; € 21.4 million was paid in cash and € 6.6 million of debt of Palace Cinemas was assumed.
This Agreement is considered to be a significant agreement as its value exceeds 10% of the Company’s equity as at 30 September 2010.