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Cineworld in £500mln deal for Polish rival Cinema City

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Steve Wiener’s final act as chief executive of Cineworld (LON:CINE) will be to oversee Britain’s biggest cinema operator’s merger with Poland’s Cinema City.

Wiener leaves the company in March after 18 years and his job will be passed on to Mooky Greidinger, the boss of Cinema City.

Cineworld is buying Cinema City’s 100 multiplexes in eastern Europe and Israel in a cash plus shares deal worth just above £500mln.

It will pay Cinema City £272mln in cash and has launched a £110mln rights issue to fund the acquisition. Cinema City will take a 24.9% stake in the integrated group.

Mooky Greidinger’s brother, Israel, will become chief operating officer, with chief financial officer Philip Bowcock keeping his post.

The company, which will manage 201 cinemas and 1,852 screens when the deal is complete, said it does not expect the merger to lead to significant job cuts.

It is Cineworld’s first move overseas, following in the footsteps of rivals Odeon and Vue which have already staked their claims abroad.

Together the trio control almost three-quarters of Britain’s cinema market.

It follows the acquisition of indie chain Picturehouse last year, which helped Cineworld cement its position as the biggest cinema operator in the UK.

Cineworld chairman Anthony Bloom said: “This is an exciting and unique opportunity for Cineworld to offer shareholders enhanced growth prospects and attractive returns via exposure to some of the most promising cinema markets in Europe.

“Cinema City is an extremely well-run and dynamic business, which creates a platform for further growth in future.”

The news prompted a 4.5% rise from the share price, now 410p and just 30p off its all-time high.

Quick facts: Cineworld Group PLC

Price: 36.47 GBX

AIM:CINE
Market: AIM
Market Cap: £500.35 m
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