09:44:21 EDT Fri 14 Aug 2020
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Cineplex Inc
Symbol CGX
Shares Issued 63,333,238
Close 2020-03-18 C$ 8.84
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Globe says Cineworld, Cineplex deal on shaky ground

2020-03-18 07:06 ET - In the News

The Globe and Mail reports in its Wednesday edition that Cineplex and Cineworld Group stock tumbled on Tuesday as the companies' $2.8-billion merger deal got caught up in worry over whether acquisitions in all sectors can be completed as markets gyrate due to the global coronavirus pandemic. The Globe's Jeffrey Jones and Andrew Willis write that Cineplex shares finished Tuesday at $9, which is $25 below the price Cineworld offered to pay in December. Cineplex said on Monday it is closing all 165 of its cinemas until at least April 2. Cineworld followed suit with its theatres in the U.K. and Ireland on Tuesday. A key question is the health of the companies as revenue is squelched. Accelerate Financial boss Julian Klymochko says, "The market is pricing in that it's a totally dead deal at this point." He says Cineworld has been a consolidator in the industry, and now investors must wager on just how committed it is to sticking with that role. "If that's the case, there's potential for it closing on the terms, or even repricing." A possible deal-breaker is a condition that Cineplex must prevent its debt from rising above $725-million. It said on Monday it is cutting expenses to offset the impact on revenue.

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