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AMC chief calls new Chinese owner 'great news' for its theaters

May 24, 2012|By Richard Verrier
  • Gerry Lopez, chief executive of AMC Entertainment, left, shakes hands with Zhang Lin, vice president of Dalian Wanda Group, attend a signing ceremony in Beijing for Wanda to acquire AMC.
Gerry Lopez, chief executive of AMC Entertainment, left, shakes hands… (Ng Han Guan, Associated…)

AMC Entertainment Chief Executive Gerry Lopez said the Chinese conglomerate poised to take over the nation's second largest theater chain would provide needed debt relief and resources to upgrade many of its cinemas across the country.

"We're going from a group of five financial owners -- private equity funds -- to a single strategic, long-term buyer who happens to love this business and who is already in this business," Lopez said in an interview Thursday. "For us, this is nothing but great news."

After a year of talks, Dalian Wanda Group, China's largest theater operator, reached a deal last weekend to buy Kansas City, Mo.-based AMC Entertainment for $2.6 billion. The pairing, which is subject to regulatory approval, would create what the companies said would be the world's largest cinema operator, with 420 theaters and 5,800 screens in the world's two largest film markets.

"What you have when you put us together is a pretty unique combination," Lopez said.

The deal would significantly reduce AMC's debt load, currently about $1.9 billion. Wanda also has agreed to invest up to $500 million in AMC's circuit, which would enable the company to accelerate ongoing upgrades of its theaters with improved food and beverage offerings, extra wide screens and specialty programming such as Spanish language and Bollywood films, Lopez said. 

AMC already has a partnership with China Lion, a Los Angeles company that distributes Chinese films to North American theaters.

Lopez said AMC executives would retain control over what types of movies the chain chooses to screen in North America. "At the end of the day, there are two kinds of movies: those that people want to see, and those that they don't," he said. "Those decisions are going to remain on my programmer's desk."

Lopez said he and his management team had signed long-term employment agreements. "Wanda did make it clear that they want my team and I to remain in place," he said.


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